New York’s Persian Rug Dealers Feel Sanctions Against Iran

Hamid Kermanshah compares a fine Persian rug to a Picasso, or a Van Gogh. In his eponymous Kermanshah Oriental Rugs shop near Union Square he pulls out antique Persian rugs made of wool, cotton and silk, gesturing to the tight hand-knotted weave, the vibrant colors, and the intricate patterns as if he was pointing to a painting. “It’s a great art,” he said. “But only particular people know about it.”

Kermanshah has been in the rug business his whole life, like his father before him. He has operated out of the shop on Fifth Avenue for 35 years with his brother, and still gets most of his clients by word of mouth. But as the United States renewed sanctions against all imports from Iran, he is worried about the threat to his business.   

Sanctions were put back into place this November as the United States pulled out of the Iran nuclear deal that President Trump had railed against since his election. The president had made the announcement last May.  

Persian rug dealers are not new to sanctions on their businesses, which have been on and off for over 30 years. U.S. sanctions were first levied against Iran in 1979 after the Iran hostage crisis, prohibiting the import of all goods from Iran. These sanctions were lifted in 1980, and the rugs flowed in again.  Throughout the 80s, 90s, and early 2000s the United States banned Iranian oil imports and trade with Iran, blocking banks and any entity associated with terrorism to do business in the United States. In 2010, these sanctions were expanded to ban imports of Persian pistachios, caviar, and rugs. Shop owners were once again prohibited from importing their wares.

A Naim Persian rug.

Five years later when the Iran nuclear deal passed, the Persian carpet business boomed once again. In Iran, carpet exports went up 39 percent in the first four months, with American imports making up a large portion. Here in New York, carpet shops brought in a slew of the handmade pieces.

Now, they cannot—and everything has ground to a halt once again. Being thrust back into an embargo this fall was unwelcome news for carpet dealers, but not a surprise, and most shop owners suspect the ban won’t last.

“It’s hard to forecast the future, but we’ve been through this in the past,” said David Basalely, 65, one of the owners of Eliko Antique Rugs on Madison Avenue. “The embargo has never lasted for more than a few years.”

Basalely has been in the rug business for 40 years and was able to import a number of Persian rugs right before the embargo went back into place. He estimates he has a few hundred pieces and that his business will be able to last a couple of years before that supply depletes.

“The embargo hasn’t been in effect long enough to affect the prices,” said Basalely. But he notes that if it continues, he will have to adjust his prices as the supply drops.

Folded rugs in the Manhattan Rugs warehouse.

In the meantime, however, Basalely has had to supplement his wares with non-Persian rugs. “We make our own rugs that mimic the color and design, but they are not specifically the same texture and quality. We also import rugs from India, Pakistan, or Turkey, but it’s not exactly the same look.”

Basalely explained that many customers were willing to adapt as long as the rugs have the same bright color and rich textures. But he admits, “It’s hard to substitute a Persian rug with other product.”

Abraham Keypour owns Manhattan Rugs (ironically the warehouse has moved since their naming and is now out on Long Island.) He works with three of his brothers, selling rugs like their father before them. They too have weathered on and off again embargoes—and they’ve adjusted with each one. “The thing is, every time they sanction it, we change our business” he said. 

Right before the latest sanctions the Keypour brother brought in thousands of Persian rugs in bright blues and reds and greens, now stacked neatly in their 14,500 square foot warehouse. So he does not worry about running out. “I wish customers would buy them all, but they won’t,” he joked.

A mountain of hand-woven Persian rugs in the Manhattan Rugs warehouse.

Keypour isn’t worried about his business’s bottom line, though. Like Basalely, he also now imports handmade wool and silk rugs from India and Pakistan. He started bringing in these imitations during the last sanctions to diversify his offerings.  He explains to customers that they aren’t Persian, but that the materials are the same and designs are close. Keypour says that outside the warehouse walls no one can tell the difference, and the imitations from India and Pakistan are very high quality. “The rugs from Pakistan and India fill the void,” he said, gesturing to his full warehouse. 

Kermanshah’s business model is slightly different. In his Union Square shop, he sells antique rugs, many of which he buys from dealers already in the United States. For Kermanshah, the worry isn’t an inability to import new genuine Persian rugs but that the influx of imitations rugs in other stores will threaten his business.

“I have to compete with the imitations,” Kermanshah said. “The sanctions are one of the reasons these copies started.” Kermanshah says he can spot an imitation carpet instantly, and that he will not sell them. Even rolled up in his shop, he can spot different styles of Persian rugs, named after the regions they are from– Tabriz, Shiraz, Naim.

Hamid Kermanshah unfurls antique Persian rugs in his eponymous Kermanshah Oriental Rugs shop near Union Square. 

A genuine Persian rug is usually made by a woman in a village, and can take months to years to weave, depending on how small the knots are and the size of the rug, Kermanshah says genuine rugs only get more valuable as time goes on, available to be refurbished and resold decades after use. He says the imitations have no resale value, and end up being thrown away, creating “a lot of garbage for society.”

“But the Persian rug, if it’s genuine, you never see anybody throw it in the street,” said Kermanshah. “They always can reevaluate it.”

Kermanshah emphasizes that he isn’t nativist about where rugs are from. He focuses instead on the authenticity of the designs.  To him, a rug made in India in a traditional Indian style is art. But a rug made in India in a copy of a Persian style is nothing more than an imitation.  “I have original Chinese rugs from the 1700s, I have original Moroccan designs, genuine rugs from India,” he said. “Just no imitations.”

A traditional Persian rug on a loom.

For now, the sanctions have not yet  had an impact on the price of antique rugs. But Kermanshah does worry that some customers are scared away by the idea that the cost of rugs may be higher because of the sanctions, so they don’t even think about buying.

The sanctions have also hampered the ability of the dealers to make repairs. Almost all rug dealers used to send genuine Persian rugs to Iran for repair. They can’t do that any more: “If a rug has a big hole, major tear, major wear, then we usually send it overseas because it’s cheaper and they do better quality work because they have expertise,” said Basalely. “Those restorations end up costing us a lot more domestically, so that really ended up impacting our bottom line.”

Antique Persian rugs at Kermanshah Oriental Rugs.

Kermanshah has the same problem. “If it’s major, we wait for the sanctions to lift,” he said. “Persian rugs they should give it to the Persian people to repair.”

In the end, Kermanshah hopes the sanctions will be lifted soon, and feels it will be better for the economy of Iran and the United States when they are. “Hopefully, the government will understand this is art, it is family produced,” said Kermanshah. “It’s hurting the families [that produce the rugs], not the government.”