As India and Iran reboot their ties, issues related to food security and cooperation in the agriculture sector are set to be the edifice, going ahead. The two countries have now agreed to form a joint committee for expanding cooperation in the agriculture sector. The committee is expected to be in place in the next three months. Iran’s Deputy Agriculture Minister Mohammad Mehdi Borumandi paid a visit to India recently to take the matter forward.
However, policymakers of both countries are now rushing to resolve the payments issue amid Iran’s depleting rupee reserves to ease bilateral trade.
Rice is one of the main items that India has exported to Iran. While in April and May, India’s rice exports to Iran dropped to 5000 tonnes compared to 26,000 tonnes in the corresponding period in the previous year, in 2022-23 New Delhi shipped about 1 million tonnes of the grain to Tehran – almost the same as 2021-22. But prior to that India’s basmati rice exports to Iran were about 7 lakh tonnes. Besides rice, India has also supplied tea, sugar, drugs among other things.
Meanwhile, Iran is keen that India resumes imports of oil from the West Asian country, even as the two nations have upped the game to increase non crude trade. Despite US sanctions on Russia, India has continued to import crude oil from Moscow. India has maintained that strategic interest will be the guiding force for carving out New Delhi’s foreign policies. With India’s demand for oil rising, sources said that imports of Iranian oil could well be within the policy ambit.
“In the new geopolitical frame, India may look at oil from Iran, though there is no decision on this as of now,” an analyst told India Narrative. India is now among Iran’s top five export markets.
Until 2018 – when the US sanctions kicked in, Iran was one of the primary oil suppliers for India.” For New Delhi, letting go of Iranian crude supplies was a difficult transition as it moved to other suppliers such as Saudi Arabia, Iraq, and as far as Nigeria and Angola to spread its energy import risk,” Observer Research Foundation said.
India Briefing said that as a member state of the BRICS (Brazil-Russia-India-China-South Africa) block and the Shanghai Cooperation Organization (SCO), “India is critical to Iran not only in terms of trade, investment, and security, but also in Tehran’s broader vision of advancing a multipolar world order with its pivot to the East.”