A business official says that Iran has lost its oriental carpet exports to rivals, despite having the reputation of the world capital of hand-made rugs.

While in the 1980s Iran was exporting $1.7 billion of rugs, now the volume of exports is so low that “I am ashamed even to mention the figure,” Razi Haji-Aghamiri told ILNA a member of carpet producers’ chamber of commerce news agency in Tehran.

According to Haji-Aghamiri, Iran’s annual exports have dropped to $50 million, while India, Pakistan and more recently Turkey and Afghanistan have taken Iran’s global market share.

The trouble began around 2005, when former populist president Mahmoud Ahmadinejad was elected and Iran’s relations with the West took a turn for worse, he said.

In late 2000s, the United States and its European allies began demanding restrictions on Iran’s nuclear program that involved enrichment of uranium. As talks to resolve the issue failed, the West with the tacit agreement of China and Russia imposed international economic sanctions on Iran, restricting its trade and ability to conduct normal banking relations with the world.

Iran’s rug industry is now limited to its own local market, while people’s living standards have dropped in the past five years due to renewed US sanctions.

Business circles have become optimistic that after the recent agreement to restore ties with Saudi Arabia, exports can increase to the wealthy oil exporter and other regional countries. However, Haji-Aghamiri told ILNA that Saudi Arabia does need Iranian rugs, because it has a small market for the product.