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India Postpones Response to WTO Queries on Rice Export Ban for WFP


Published Date: June 05, 2024
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India's recent policy changes in the rice market have significant implications for global trade and food security. The government’s decision to ban non-basmati white rice exports has stirred considerable discussion and concern among international trade partners.

Timeline of the Ban:

August 2022: Initial Restrictions

In August 2022, India took its first steps towards restricting rice exports. The government imposed limitations on the export of broken rice and added additional duties on non-basmati white rice, excluding parboiled rice. This initial move aimed to manage domestic supply and stabilise food prices amidst global economic fluctuations which directly impacted Rice Exporters significantly.

July 2023: Complete Ban

By July 2023, the Indian government extended these measures, instituting a comprehensive ban on non-basmati white rice exports. This decisive action was taken to ensure sufficient domestic availability and curb rising food prices within the country. It is important to note that this ban did not affect basmati rice or parboiled rice, which continued to be exported without restrictions, offering some relief to rice exporters

Global Reactions and Concerns

WTO Inquiries and International Response:

India's export policy has not gone unnoticed on the global stage. Recently, at the World Trade Organization (WTO), several countries, including Australia, Canada, Brazil, Switzerland, and the UK, raised questions regarding India's rice export practices. They sought clarifications on whether India had prohibited its rice exporters from participating in United Nations World Food Program (WFP) tenders, potentially violating multilateral trade rules.

The UK’s Observations:

During a recent WTO agriculture committee meeting, the UK pointed out that India's restrictions had significantly reduced the total export volume of rice for the 2023-24 period. This decline, they suggested, might be contributing to the rise in global rice prices, affecting food security in various regions.

India's Response at the WTO:

India did not immediately provide detailed answers to the inquiries from the concerned countries but assured that it would address the questions soon. The primary issue at hand was whether India’s policies had hindered the WFP’s efforts to procure rice for humanitarian purposes in countries like Cameroon, Togo, and Algeria.

India's Commitment to WFP:

WTO Ministerial Conference Decision:

At the WTO’s 12th Ministerial Conference in Geneva in 2022, members agreed to exempt WFP’s humanitarian food purchases from export restrictions. Although India initially hesitated, citing the need to retain flexibility for domestic food security, it ultimately consented to the decision.

Reports and Clarifications:

In early 2024, reports emerged that India’s Directorate General of Foreign Trade (DGFT) had denied requests from Indian rice exporters to participate in WFP rice tenders. Countries questioned whether these reports were accurate and if India had indeed restricted such exports, thereby violating its WTO commitments.

India's Official Stance:

India has clarified that while the general ban on non-basmati white rice exports remains, it has made exceptions for government-to-government (G2G) agreements to address food security needs of specific countries. These exemptions underscore India's effort to balance domestic food security with international obligations.

Conclusion:

India's ban on Rice Importers is a strategic measure to safeguard its domestic market and control food prices. However, this policy has prompted significant international scrutiny and raised questions about its compliance with global trade agreements. As India navigates these complex issues, its responses and future policies will be closely watched by the global community, particularly those concerned with food security and international trade norms.

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