The Indian hoopsters came back strongly in the second and third quarters but lost steam in the final period to lose the Group B league match.
Iran, who won a bronze in the 2010 Asian Games, led 23-17 after the first period of 10 minutes. But, India cut down the deficit in the second quarter to three points as the scoreline read 40-37 at the interval in favour of Iran.
Iran quickly opened up an 11-point lead in the third period but the Indians still refused to give up. They cut down the deficit to just six points, heading into the fourth frame 58-64.
The Indians, however, lost way thereafter as Iran had a 12-2 run at the start of the final frame before winning the match.
Samad Nik Khahbahrami scored 23 points for Iran, while Hamed Afagh and Asghar Kardoust contributed 16 and 12 points respectively.
For India, Vishesh Bhriguvanshi answered with 21 points while Amrit Pal Singh scored 15.
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Ten teams were divided into two groups of five each and four best teams from each group will qualify for quarterfinals.
Besides India and Iran, Chinese Taipei, Qatar and Japan are the other three teams in Group B. Defending champions Lebanon, China, Macau, Philippines and Uzbekistan are in Group A.