Trump's Tariff Proposal Casts Shadow Over India's Thriving Air Cargo Trade with Iran
India's rapidly expanding air cargo sector faces new challenges from an unexpected direction. United States President Donald Trump has proposed imposing a substantial 25% tariff on countries that maintain trade relations with Iran. This move directly threatens emerging trade routes that have shown remarkable growth in recent years.
Spectacular Growth in India-Iran Air Cargo
The timing of this proposed tariff is particularly concerning for Indian exporters. Over the past five years, air cargo movement between India and Iran has experienced explosive growth, registering an increase of nearly 200%. India has firmly established itself as one of Iran's top five trading partners during this period.
Official data from the Directorate General of Civil Aviation reveals the dramatic scale of this expansion. In 2023, air cargo shipments from India to Iran totaled 563 tonnes. By September 2025, this figure had more than doubled to approximately 1,200 tonnes. The growth trajectory becomes even clearer when examining earlier data. During the entire year of 2021, India exported 661 tonnes of air cargo to Iran. This volume nearly doubled within just a few short years, reflecting significantly strengthened cooperation between the two nations.
Humanitarian and Commercial Cargo Flows
While much attention has focused on the Chabahar port as an alternative trade route between India and Afghanistan, air cargo has played an equally vital role. This transportation method has been particularly crucial for moving time-sensitive humanitarian aid, including essential pharmaceuticals, tea, and rice shipments.
Freight forwarders have developed specialized services to facilitate this trade. They currently offer express three-day and standard six-day delivery options for parcels and commercial goods traveling between the two countries. These services handle diverse products including textiles, machinery, and various food products.
According to information from the Indian embassy in Tehran, major Indian exports to Iran include:
- Rice and tea
- Sugar and pharmaceuticals
- Man-made staple fibres
- Electrical machinery
- Artificial jewellery
Conversely, India primarily imports from Iran:
- Various dry fruits
- Organic and inorganic chemicals
- Glassware products
Industry Experts Voice Serious Concerns
Members of the Federation of Freight Forwarders' Associations in India have expressed deep apprehension about Trump's proposed policy. They warn that this move could adversely impact India at a time when the country already faces increasing tariffs on its exports to the United States.
The introduction of additional tariffs would create multiple negative effects. It would harm bilateral trade relations, reduce the competitiveness of Indian products in the American market, and significantly increase operational costs for exporters already navigating complex international trade landscapes.
S Anil Kumar, vice chairman of FFFAI, provided specific insights to The Times of India. He highlighted that Hyderabad serves as a major contributor of pharmaceutical exports to Iran, while rice shipments from Andhra Pradesh form another significant component of this trade relationship.
Kumar emphasized that Trump's policy moves would likely have substantial consequences for India. Given the country's strong trade and cultural ties with Iran, such measures could deliver a serious blow to Indian exporters and potentially disrupt long-standing economic relationships that have developed over decades.
Contrasting Trade Patterns Emerge
While India-Iran air cargo volumes show remarkable growth, a completely different trend appears in trade with the United States. Air cargo volumes from India to America have slumped to their lowest level in nine years.
DGCA data indicates that cargo movement to the United States fell to approximately 6,100 tonnes in 2025. This represents the lowest volume recorded since 2016, creating a stark contrast with the booming trade relationship developing with Iran.
The proposed tariff creates particular concern for specific regional economies within India. Hyderabad's pharmaceutical export sector and Andhra Pradesh's rice shipping industry both maintain significant trade relationships with Iran that could face disruption if the tariff proposal moves forward.
Industry observers note that the timing of this development creates additional challenges. The air cargo sector had been experiencing strong growth and developing new trade routes, only to face potential disruption from external policy decisions originating thousands of miles away.
Exporters and freight forwarders now face uncertainty as they await further developments regarding the proposed tariff. Many are reviewing their supply chains and exploring potential alternatives while hoping for diplomatic resolutions that might preserve the valuable trade relationships developed in recent years.
