Amidst the prospect of a record rice harvest in India, exporters are anticipating the removal of the ban on export of white rice as well as the 20% duty on parboiled rice exports. Thanks to a good and widespread monsoon throughout the nation, farmers have increased the paddy acreage by more than 4%, reaching over 410 lakh hectares (lh).

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India’s Rice Export Policy

The president of The Rice Exporters Association, the trade association for non-basmati rice exporters, BV Krishna Rao, stated, “The government should remove the duty on parboiled rice exports and open up white rice exports as we are heading for a record crop.”

In July 2023, India prohibited the export of non-basmati rice in an effort to increase domestic supply and shield consumers from high prices. In an effort to discourage exports, the government also imposed a 20 percent export duty on parboiled rice on August 25, 2023.

Exporters are hoping that policy changes will be made in the non-basmati front, as the minimum export price (MEP) on shipments of basmati has been removed recently. TREA has already recently submitted a request for a uniform policy for non-basmati rice exports to the government.

Prem Garg, President of the Indian Rice Exporters' Federation, wrote to Pralhad Joshi, Union Minister for Consumer Affairs, requesting that the center “consider providing assistance and relief in respect of non-Basmati white rice and parboiled rice exports by allowing its free export without any restrictions and completely removing the export duty of 20 percent.”

“The upcoming crop looks promising when compared to last year's crop, and inflation is also under control. This would not only increase revenue for the country, but it would also greatly benefit farmers and the rice industry as a whole, with nearly 80 percent of exporters as MSME beneficiaries,” he said.  

Paddy Acreage 

As of September 13, the area planted to paddy had surpassed the average acreage; however, there are still several states where sowing is ongoing. The area planted for kharif has so far exceeded the average of 401.55 lh, which is the average of five years from 2018–19 to 2022–23. Moreover, the chances for the rabi cropping season appear favorable, as an abundant monsoon is restoring the reservoir levels.

India's rice crop is expected to reach a record 139 million metric tons in 2024–2025, according to the US Department of Agriculture. This is due to a higher-than-expected harvested area for the kharif crop, particularly in the eastern states that have experienced better monsoon rainfall than the previous year.

India’s Rice Exports

Rao said that, as was recently shown in the case of basmati rice, the farmers will also benefit from the opening up of rice exports and the lowering of the duty on parboiled rice. The cost of Pusa Basmati 1509 variety paddy increased from ₹2,700 per quintal to ₹3,300 in the last few days due to the removal of MEP last week. Furthermore, he said, there is a chance that people will ship the non-basmati rice as basmati with the MEP removal and the higher duty.

After non-basmati rice exports were prohibited in July 2023, the volume of shipments decreased by almost 40% in 2023–24, from 17.29 million metric tons to 10.47 million metric tons. Value-wise, non-basmati shipments fell from ₹49,677 crore in 2022–2023 to ₹35,715 crore in 2023–2024. Of the non-basmati shipments, parboiled rice made up around 45%, followed by raw and broken rice.

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REFERENCE- thehindubusinessline.com

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