India lifts ban on non-basmati white rice exports | Fusion - WeRIndia

The Indian government has lifted its ban on the export of non-basmati white rice, a move that reverses the restrictions imposed in July 2023 to curb rising local prices.

India, as the largest rice exporter globally, accounting for over 40% of the world’s rice exports, had earlier halted shipments of this staple to control domestic inflation.

However, with inflation cooling, the government has decided to allow the export of all varieties of white rice, with an added condition of a minimum export price (MEP) set at $490 per tonne.

The MEP is designed to prevent exports at excessively low prices. Thus, it ensures that rice is not sold below a certain threshold to international buyers.

This policy aims to maintain a balance between local market stability and the need for foreign trade.

The move to impose MEP aligns with India’s broader strategy of managing high food inflation, which has been exacerbated in recent years due to weather disruptions.

In August 2024, India saw its consumer inflation drop to a nearly five-year low of 3.65%, with food inflation reducing to 5.35%. This is significantly lower than the 9.94% seen in the previous year.

This easing of inflationary pressures has encouraged the government to reconsider some of the stringent export controls that were previously in place.

This latest announcement follows other recent adjustments in India’s trade policies.

Earlier this month, the government lifted an MEP of $950 per tonne on basmati rice exports. Besides, it also removed the MEP of $550 per tonne on onion exports, a commodity that had faced export restrictions due to a 20% fall in output caused by irregular rainfall in key agricultural states.

With India’s ample food grain reserves, the government has expressed confidence in fulfilling both domestic and international demands.

Food minister Pralhad Joshi highlighted the country’s preparedness to meet global needs, citing sufficient stocks of rice and other essential food grains.

India’s rice exports have always been significant, with the country exporting nearly 22 million tonnes of rice in 2021-22, which amounts to around one-sixth of its domestic production.

However, the country witnessed a sharp decline in rice exports during the April-June 2024 period, with shipments falling by 34% to 3.2 million tonnes due to the earlier restrictions on non-basmati white rice.

The lifting of the ban, alongside the introduction of MEP, is expected to gradually restore India’s position in the global rice market, benefiting both local farmers and international buyers.

Image Credit: Jubair Bin Iqbal, CC BY-SA 4.0, via Wikimedia Commons

Image Reference: https://commons.wikimedia.org/wiki/File:Indian_White_Rice.jpg