Rice exporters want ban on non-basmati rice to go on prospects of record crop

Amidst prospects of a record rice harvest, exporters are looking forward to removal of the ban on white rice exports and the 20 per cent export duty on parboiled rice. Aided by a good and widespread monsoon across the country farmers have expanded the paddy acreage by over four per cent to over 410 lakh hectares (lh).

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

India had banned exports of non-basmati rice in July 2023 to ease domestic supplies and protect consumers from high prices. Also, the government had levied a 20 per cent duty on exports of parboiled rice on August 25, 2023, to discourage the exports.

The recent removal of minimum export price (MEP) on basmati shipments has rekindled the hopes among the exporters of some policy correction on the non-basmati front. TREA has already made a representation to the Government in the recent past requesting for a uniform export policy for the non-basmati rice.

In a letter to Pralhad Joshi, Union Minister for Consumer Affairs, the Indian Rice Exporters’ Federation President Prem Garg urged the centre “to 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 per cent”.

“The upcoming crop is looking good as compared to last year’s crop and inflation is also under control. This would not only generate additional revenue for the nation but also greatly benefit farmers and the rice industry as a whole which almost has 80 per cent exporters as MSME beneficiaries,” he said.  

Sowing continues

Though the area under paddy exceeded the normal acreage as of September 13, sowing is still on in several States. The planted kharif area, so far, is higher than the normal area (average of five year from 2018-19 to 2022-23) of 401.55 lh. Besides with a surplus monsoon replenishing the reservoir levels, prospects for the rabi cropping season looks good.

The US Department of Agriculture has projected India’s rice crop to be at a record 139 million tonnes during 2024-25 on higher-than-expected harvested area for the kharif crop, especially in the eastern States that have received better monsoon rainfall than the previous year.

Rao said the opening up of rice exports and lowering the duty on par-boiled rice will also benefit the farmers as recently witnessed in the case of basmati. The removal of MEP last week has led to an increase in prices of paddy of the Pusa Basmati 1509 variety from ₹2,700 a quintal to ₹3,300 quintal over past few days. Further, with the MEP removal, if the non-basmati continues with a higher duty, there is a possibility that people may ship it as basmati rice, he said.

Following the curbs on non-basmati rice exports during July 2023, the shipments saw a near 40 per cent decline in volumes during 2023-24 to 10.47 million tonnes from the previous year’s 17.29 million tonnes. In value terms, the non-basmati shipments declined to ₹35,715 crore in 2023-24 from ₹49,677 crore in 2022-23. Parboiled rice accounted for about 45 per cent of the non-basmati shipments, followed by the raw rice and broken rice.