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February 2024

India feeds strategic partners despite ban on rice exports

Nepal, Bhutan, and Asean region, among others, were recipients of India’s largesse

The overall growth of rice export to South Asian countries was up 478% in November 2023 as compared to October, govt data showed. (REUTERS)

New Delhi: Despite a ban on rice exports, India continues to feed the world, especially its strategic neighbours such as Nepal, Bhutan, Sri Lanka, Maldives, Malaysia, Indonesia, Vietnam and Iran, as well as the wider Asean region.

According to government data analyzed by Mint, rice export to South Asian countries alone was $567 million in the first eight months of the current 2023-24 fiscal, as compared to $1.24 billion in the corresponding period last year.

In the case of Asean countries, rice export was at $341 million in April-November 2023 as compared to $541 million in the same period of 2022. The South Asian countries named above are not part of Asean.

The figures show that rice export is taking place to these countries under bilateral arrangements in spite of the ban, although prices may not be comparable.

The exports are taking place at the government-to-government level and those are being facilitated by National Cooperative Exports Ltd, a government export body which was set up under the Multi-State Cooperative Societies (MSCS) Act, 2002 to export agricultural produce and allied items.

However, industry leaders predicted that the ban will keep prices of essential food items in check and make rice available for distribution among beneficiaries of PM Garib Kalyan Anna Yojana for free for the next five years.

“The government is doing a commendable job by keeping domestic prices in check and providing food to neighbouring countries,” said Rajnikant Rai, CEO of ITC’s agribusiness division.

Rice export to Iran—a key neighbouring country—has scaled up to $60 million in November 2023 from $4.25 million in October, registering a growth of 1,314%, while oil meals export to the country grew from $1.22 million in October 2023 to $46.52 million in November—registering a growth of 3,713%, the data showed.

The overall growth of rice export to South Asian countries was up 478% in November 2023 as compared to October, government data showed.

India exported rice to Bhutan worth of $0.94 million in November from $0.78 million in the last month, recording 21% growth.

Rice worth $5.77 million exported to Nepal in November, which was $3.64 million in October.

In the ASEAN region, Vietnam recorded the highest 171.43% growth in rice export as it grew from $5.39 million in October to $14.63 in November 2023. Indonesia imported Indian rice worth $1.80 million in November from $1 million in the last year.

As of now, the government cleared exports of 2.77 million tonne (mt) of non-basmati white rice to 14 key Asian and African nations, including Singapore, Nepal, Malaysia, and the Philippines.

In addition to white rice, India allowed export of 14,184 tonne wheat, 5326 tonne atta, 15,226 tonne maida and 48,804 tonne broken rice to Bhutan on 30 November. On the same day (30 November), export of broken rice was allowed to Mali (1 lakh tonne), Senegal (5 lakh tonne), Gambia (50,000 tonne ), and Indonesia (2 lakh tonne).

India imposed a ban on wheat and its products such as atta, suji (semolina) and maida in May 2022 and on broken rice in September 2022. Amid higher inflationary pressure primarily due to skyrocketing food prices, the government in July 2023 banned exports of non-basmati white rice, imposed a 20% export duty on parboiled rice and set a minimum export price (MEP) of $1,200 per tonne for basmati rice in August 2023.

The ban on rice was necessitated after the reduction of public stock in the Central pool resulting in a steep rise in the prices of key staple food cereal.

However, after the ban, rice prices shot up significantly in the global market, making India’s strategic partner asking for the foodgrain in tranches. Later on in October 2023, the MEP on Basmati was revised to $950 per tonne. QR Code

Published Date: January 2, 2024

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