India's Record Tea Exports Face Potential Disruption from US-Iran Conflict
India's tea industry achieved a historic milestone in 2025, exporting an unprecedented 281 million kilograms valued at approximately Rs 8,500 crore. However, this remarkable success now faces a significant threat as the ongoing US-Iran conflict threatens to disrupt critical shipping routes through the Strait of Hormuz, according to industry experts and trade associations.
Vulnerable Export Channels Through Strategic Waterway
Nearly 60% of India's tea exports travel through the Strait of Hormuz destined for West Asia and Commonwealth of Independent States (CIS) nations. This strategic chokepoint has become increasingly volatile with hundreds of ships currently stranded due to geopolitical tensions. The Middle East alone accounted for 121 million kg of exports in 2025, with the United Arab Emirates (50.7 million kg), Iraq (52 million kg), Iran (10.6 million kg), and Saudi Arabia (6.7 million kg) representing key markets.
The CIS region contributed an additional 43 million kg, with Russia leading at 31 million kg followed by Kazakhstan and other member nations. In monetary terms, Middle East exports were worth Rs 3,300 crore while CIS exports totaled Rs 842 crore during the record-breaking year.
Industry Leaders Express Concern Over Multiple Challenges
Atul Rastogi, Vice-Chairman of the Indian Tea Association, highlighted the distinct nature of this crisis compared to previous geopolitical disruptions. "While the impact of the Russia-Ukraine war was borne primarily by Africa, India and Sri Lanka could face significant consequences this time regarding tea exports," Rastogi explained. He emphasized that shipping costs would inevitably increase, creating financial pressure across the supply chain.
Rastogi noted a potential silver lining, suggesting that "if there is a regime change in Iran leading to lifted US sanctions, India may gain greater access to this substantial market for Indian tea."
Logistical and Economic Impacts Loom Large
Sujit Patra, former ITA secretary and member of the Indo-Iran joint working group on tea, warned that prolonged conflict would directly affect tea exports through the Strait of Hormuz. "Increased freight charges, higher insurance premiums, and extended shipping times present serious concerns for both exporters and importers," Patra stated.
Despite these challenges, Patra expressed confidence in the industry's resilience. "Tea holds a special place in the hearts of people in affected countries, particularly Indian tea. The export community will overcome this sudden disruption and continue to dominate global markets, especially in the Middle East," he affirmed.
Specific Market Vulnerabilities Identified
Bijoy Gopal Chakraborty, President of the Confederation of Indian Small Tea Growers Association (CISTA), outlined three primary challenges created by the US-Iran conflict:
- Logistical barriers disrupting established shipping routes
- Market stagnation in key importing nations
- Negative impact on local tea prices due to supply chain disruptions
"Premium Assam Orthodox tea has substantial markets in Iran and Iraq," Chakraborty emphasized. "The volatile situation in West Asia will directly affect tea business operations for an extended period."
The industry now faces a critical juncture as geopolitical tensions threaten to undermine India's position as a global tea export leader, particularly in markets that have driven recent record growth.
