A magic comeback? Iran’s carpet trade

JUST north of Khayyam underground railway station, named after Persia’s pre-eminent 11th-century poet, lies Tehran’s sprawling carpet bazaar, said to hold the largest collection of handmade rugs on earth. The carpet business, Iran’s largest after oil, is emerging from one of its darkest periods. Dealers say demand has shot up since Hassan Rohani’s election as president in June. Some say sales have more than doubled. If the renewed talks between Iran and the Western governments over its nuclear ambitions go well, carpets may sell still faster.

During Iran’s reformist years in the late 1990s America lifted an embargo on importing them, but in 2010 reimposed it, cutting dealers off from their biggest foreign market. Then, in 2011, sanctions by Congress on Iranian banking made it hard for ordinary Iranians to accept payments from abroad.

So carpet dealers have had to improvise. Their products have been getting to the lucrative American market via Pakistan or Mexico, where they are mixed with shipments of local carpets. Money is channelled to Iran via middlemen in the Gulf. Some of the bazaar’s larger dealers have contacts in Dubai who help with bank accounts and offer chip-and-pin services for foreign buyers and tourists, whose cards are otherwise, owing to sanctions, useless in Iran. “We have to trust the middlemen with thousands of dollars,” explains a dealer, who says he pays up to 3% on transactions to get paid from abroad. “Many of us have been cheated. The weak have left the business. Only the strong dealers with good foreign connections have survived.”

Imitation Persian rugs mass-produced by the Chinese have filled foreign markets, but many buyers are said to be turning back to the real thing as the Chinese versions fade and fall apart. In a strange twist, Iranians are now finding new markets among China’s nouveaux riches, who are said to like pictorial carpets. A Tehran dealer points to a rug depicting a Persian princess nuzzling a lamb. “Iranians don’t like these, but our Chinese customers are buying hundreds of them.”