Conflict halts basmati trade, leaving 400,000 tonnes stranded at ports or at sea.
Freight rates more than double; West Asia buyers hold over 50% of India’s market.
Exporters face storage burdens and soaring container premium charges.
Route disruptions and Red Sea detours add 15–20 days to shipping times.
Indian rice exporters are feeling the squeeze of conflict in West Asia. Around 400,000 metric tonnes of Indian basmati rice are stuck in a holding pattern — piled up at ports or stranded mid-voyage — as the war between Iran and Israel brings export trade to an abrupt halt, Reuters reported.
Freight rates have more than doubled since the weekend's US and Israeli strikes on Iran, and new deals have all but dried up, trade officials told the new agency.
2 March 2026
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India holds the top spot globally in basmati exports, shipping the long-grain aromatic variety to buyers across the world. West Asia is by far its most important market, with Saudi Arabia, Iran and the United Arab Emirates alone accounting for more than 50% of all Indian basmati shipments.
Satish Goel, president of the All India Rice Exporters' Association (AIREA), noted that roughly 200,000 tonnes of basmati rice are stuck in transit, and an equal amount is stranded at Indian ports as the war has disrupted shipping routes across West Asia, the report said.
Exporters had already moved stocks to port in anticipation of normal business, he explained, but cannot complete the final leg of delivery — with container freight costs soaring and no alternative market large enough to absorb the volume at short notice.
AIREA has written to India's commerce ministry seeking assistance, as exporters contend with mounting storage costs for rice held at ports and, in several cases. In these steep premium freight charges, shipments are already mid-journey.
Freight Rates Rise
A study from the Atlas Institute of International Affairs shows that between 2023 and 2025, the Israel-Hamas conflict pushed freight rates sharply higher and forced ships off the Red Sea entirely. Back then, though, the tensions stayed relatively contained.
This time, nobody is making that assumption. What makes 2026 different is the scale of involvement. Four countries — the US, Israel, Iran, and, by proximity, the UAE — are now directly caught up in it.
Air routes are being rerouted. Insurance premiums are climbing. Freight rates, which had actually been contracting at the start of 2026, are set to be revised upward when major shipping lines publish their new monthly rates.
SC Ralhan, president of the Federation of Indian Export Organisations, has been candid about the situation — if ships are forced to abandon the Red Sea route and swing around Africa via the Cape of Good Hope, transit times to Europe and the United States stretch by 15 to 20 days.
Apparel Export Promotion Council also wrote to the Ministry of Civil Aviation yesterday to waive demurrage charges piling up on cargo stranded at Indian airports.
