IRAN’S FROZEN BILLIONS: WHICH COUNTRIES HOLD TEHRAN’S MONEY AND HOW MUCH IS IN INDIA?

US-Iran Tensions: Iran’s efforts to get back billions of dollars held overseas have become one of the most complicated issues in the negotiations with the United States. The release of frozen assets is now one of the main issues being negotiated between Tehran and Washington as both sides seek a possible agreement to bring military tensions to an end.

Iran has struggled to access money generated from oil exports, foreign currency reserves and other overseas revenues because of international sanctions and restrictions on banking transactions.  While much of this money is held outside the United States, Washington still has a major role in deciding whether Tehran can use those funds.

Experts say even partial access to these assets could provide relief to an economy hit by years of sanctions, high inflation, devalued currency and the destruction caused during the recent military strikes by the United States and Israel. However, turning a political agreement into an actual transfer of money could take time because of legal, financial and political hurdles.

What are Iran’s frozen assets?

The exact value of Iran’s blocked assets is not officially known. Estimates put the amount anywhere between $27 billion and more than $100 billion.

The money is spread across different categories rather than being held in one account. It includes oil revenues stuck in foreign accounts, earnings from gas and electricity exports, foreign currency reserves held abroad and assets subject to ongoing legal disputes.

When Iran sells oil overseas, payments are usually deposited into accounts in the buyer countries. Due to sanctions, Tehran has struggled to move those funds back home or use them freely.

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The first major restrictions on Iranian assets came after the 1979 hostage crisis at the US embassy in Tehran. Although some assets were later released through agreements, several claims related to military contracts signed before the Islamic Revolution are still unresolved.

A new wave of sanctions began in 2011-12 as pressure increased over Iran’s nuclear programme. Restrictions became tougher after the United States withdrew from the 2015 nuclear deal, which was formally known as the Joint Comprehensive Plan of Action (JCPOA), in 2018.

Economist Fredrik Schneider of the Middle East Council on Global Affairs said there are different forms of asset restrictions, including money officially frozen, revenues that cannot be transferred back to Iran and funds stuck in legal disputes.

Where is Iran’s money held?

Most of Iran’s restricted funds are outside the United States. China holds one of the largest portions because it is Iran’s biggest oil buyer. Estimates suggest between $20 billion and $50 billion of Iranian funds could be held in China.

Iraq also holds a substantial amount of Iranian funds, mostly from payments made for gas and electricity imported from Iran.  Estimates place that number between $10 billion and $15 billion.

South Korea previously held around $6 billion in Iranian oil revenues. In 2023, those funds were moved to accounts in Qatar. However, Washington later said that Iran would not be able to access the money in the near future.

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Other Iranian assets are located in countries, including India, Japan and Luxembourg. New Delhi is estimated to hold around $7 billion.

The amount under US jurisdiction is much smaller. It is estimated by the US Congress at around $2 billion. Much of this money is subject to court cases and compensation claims. It makes its release more complicated.

Why does US have influence over funds outside America?

Although most of Iran’s frozen money is held abroad, Washington’s influence comes from secondary sanctions.

These measures do not only target Iran. They also affect foreign banks, companies and governments that conduct transactions with Tehran.

Financial institutions that help move Iranian money risk losing access to the US financial system or facing American penalties. Because of this, countries holding Iranian funds hesitate to release or transfer the money without approval from Washington.

What could Iran gain from a deal?

A possible agreement could provide Iran with economic relief in two major ways.

One option involves allowing Iran to export oil and petroleum products while also permitting related services such as shipping, insurance and banking. Another option involves giving the country greater access to frozen funds, allowing its central bank more control over how the money is used.

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The proposal also includes a reconstruction plan worth at least $300 billion, involving regional partners and investment in Iran’s economy. Details of how that plan would work are expected to be decided under a final agreement.

The United States has said it will not directly provide money to Iran. The Trump administration has also argued that any arrangement would differ from the 2015 nuclear deal and would instead prioritise investment in areas such as infrastructure, energy and transport.

Will Iran actually get the money?

Accessing these funds may still prove difficult. Iran may be able to use some money in specific countries where it is held, but transferring it internationally could still be difficult.

Experts also warn that it is unclear how long any relief would last. Schneider said some US sanctions were created through congressional legislation. It means that a president cannot remove all of them permanently and may only provide temporary exemptions.

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A similar situation came to the fore after the 2015 nuclear agreement, when Iran got access to some funds. However, many international banks continued to act cautiously, and sanctions returned after Washington left the deal in 2018.

Iranian state media have claimed that the United States had agreed to release $12 billion in frozen assets, though Washington has not confirmed the claim.

There are also disagreements over whether Iranian funds could be used to compensate Gulf countries for war-related damage. US Treasury Secretary Scott Bessent said on X in early June that such losses would be covered through "money taken out of Iranian accounts”.

Iran rejected that idea. Iranian Deputy Foreign Minister Kazem Gharibabadi said Iranian assets were "not war spoils for Washington and not a fund to pay for the expenses of its allies”.

Impact on Iran’s economy

According to the World Bank, Iran’s economy was worth around $475 billion in 2024. Officials in Tehran estimate that recent war has caused economic losses of up to $300 billion and predict the economy could shrink by around 10% this year.

Economists say access to even part of the frozen funds could provide short-term support by helping stabilise the Iranian rial, finance essential imports and calm financial markets.

However, they warn that releasing money will not solve economic problems. Experts say controlling inflation and addressing the rising cost of living should come before any major reconstruction effort.

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"Before any reconstruction programme, controlling inflation and dealing with the cost-of-living crisis should be the priority," they said.

Iran also needs to deal with falling investment and outdated industries. Without economic security, investment is not possible. And without real investors, Iran’s economy cannot move forward and economic growth will stop.

Researchers say reducing regional tensions will also be important to attract investors. They said uncertainty between war and peace is one of the biggest barriers to investment.

2026-07-07T23:45:23Z