Please note Iceland is a schengen country so you need a schengen visa to enter Iceland.
As with transit visas..
Nationals of the following countries need an Airport transit visa when
transiting/passing through an airport in Iceland: Afghanistan,
Bangladesh, The People's Republic of Congo, Eritrea, Ethiopia, Ghana,
Iran, Iraq, Nigeria, Pakistan, Somalia and Sri Lanka. This does not
apply however, if the above mentioned nationals have a residence
permit in a Schengen country or specific types of permits issued in
Great Britain, Ireland, Liechtenstein, Andorra, United States, Canada,
Japan, Monaco, San Marino or Switzerland and the permits are valid
three months longer than intended transiting/passing through an
airport in Iceland. For further details on types of permits see
appendix 4 in the regulation on visas.
Article 21 Visa for transit through airport
A national of a state enumerated in Appendix 4, Part I, shall have a
valid Icelandic visa for transit through an airport when landing at an
Icelandic airport on the way to a another destination or in order to
change aircraft. A visa shall however not be required if the traveller
is in possession of the permit to stay referred to in Appendix 4, Part
II, and has a permit for returning to the country of stay which is
effective for at least three months after his or her transit through
the Icelandic airport.