Iran’s centuries-old carpet industry, once a symbol of cultural prestige and a $2 billion export powerhouse, is unraveling under US sanctions, shifting consumer tastes and rising competition, industry officials and traders say.
Exports of handmade rugs, which stood at more than $400 million in 2017, fell to just $41.7 million in the year to March 2025, according to customs data -- a drop of over 95% from their peak in the early 1990s, AFPreported.
The collapse followed Washington’s 2018 reimposition of sanctions, cutting off the US market that once bought more than 70% of Iranian carpets.
“During the unkind and cruel US sanctions, we lost our biggest buyer,” said Zahra Kamani, head of Iran’s National Carpet Center.
Germany, the UAE, Japan and China are now Iran’s top destinations, but volumes remain a fraction of past levels.
Rivals including India, China, Nepal, Turkey and Pakistan have captured global market share, with some rugs even imported back into Iran, traders said.
At least two million Iranians, many of them rural women, depend on carpet-weaving but earn only a few dollars a day. “We are losing even part of our domestic market due to imports,” Tehran trader Hamed Nabizadeh told AFP.
With tourism also in decline, fewer foreign visitors buy rugs, and even those who do are deterred by price tags of $30,000 or more for silk carpets.
Officials insist revival is possible. Trade Minister Mohammad Atabak said in June that new trade and currency policies could help resuscitate exports.
Analysts argue adapting designs to modern décor trends, using social media for sales and branding carpets more effectively may be key.
But with Iran’s currency plunging, many families at home are turning to cheaper factory-made rugs, and a centuries-old craft risks fading into a relic of the past.
Satellite images reviewed by AP show construction at missile sites in Parchin and Shahroud, where buildings housing mixers appear under repair.
“If they’re able to reacquire some key things like planetary mixers, then that infrastructure is still there and ready to get rolling again,” said Sam Lair of the James Martin Center for Nonproliferation Studies.
Solid-fuel missiles are central to Iran’s deterrence strategy after Israeli strikes decimated much of its air defense.
Iran operates solid-fuel missile production facilities at Khojir and Parchin, both near Tehran, as well as at Shahroud, about 350 kilometers (215 miles) northeast of the capital. All three sites were struck by Israel in October 2024, during earlier hostilities between the two countries.
Experts say the June strikes appeared designed to destroy buildings housing mixers, the machines essential for evenly combining missile fuel.
Iran had been producing more than 200 solid-fuel missiles a month before the war, according to AP.
Iran fired more than 570 ballistic missiles during the conflict, depleting an estimated third of its arsenal, according to the Jewish Institute for National Security of America.
Western officials believe Tehran could try to source mixers and propellant chemicals from China, which has previously supplied materials for Iran’s missile program. Beijing said it supports Iran’s sovereignty but voiced “deep concern” over rising regional tensions.
Iran’s Defense Minister Aziz Nasirzadeh said last month the country was now focused on producing “military equipment with higher precision and greater operational capabilities.”
Border Police sappers neutralized the device, and troops swept the area, the army said.
A week earlier, security forces raided a site near Ramallah, seizing dozens of rockets and arresting three suspects after an attempted launch.
Defense officials said, “foreign elements, led by Iran,” were working to promote rocket fire from the West Bank, which could place cities in central and northern Israel within range.
Iran has not commented on the allegations.
