Windfall gain for basmati farmers in Punjab

Aromatic varieties of basmati paddy are fetching Rs 2,900 to 5,720 per quintal as against Rs 1,550 to Rs 3,450 per quintal last year

On the back of strong demand, farmers in Punjab are reaping rich dividends, as the prices of basmati crop continued to rule high in various mandis of the state despite increase in arrival. According to the Punjab State Agriculture Marketing Board (PSAMB) data, Aromatic varieties of basmati paddy are fetching Rs 2,900 to 5,720 per quintal in this Kharif market season as against Rs 1,550 to Rs 3,450 per quintal last year.

Speaking to Business Standard, a senior official in PSAMB said, “There is huge demand of aromatic varieties of Basmati in overseas market, so farmers are getting better price for basmati crop as compared to last year. This year they are getting almost twice the price, they got last year. There is an upswing in prices of all kinds of basmati varieties this year as a result there prices are hovering around Rs. 2,900 to Rs 5,720 per quintal, which is almost two fold increase in price compared to last year.”

It is worth mentioning that popular basmati varieties like Pusa 1121 and 1509 are commanding price between Rs 3,600 to Rs 5,720 per quintal as against Rs 2,200-2,600 per quintal that prevailed last year. Also, Punjab is a major grower of Basmati crop especially PUSA 1121 around 70% and overall area under Basmati in the state is pegged around 6 lakh hectares out of total area of 28 lakh hectares.

As far arrival is concerned, the state have witnessed over 80% increase in arrival in the current procurement season as compared to the corresponding period last year. This year, the total arrival was 13.74 lakh tonnes as on November 17 compared to 7.58 lakh tonnes during previous year. While, last year the total arrival was 14.05 lakh tonnes.

Experts informed that the Punjab government recently abolished market fees, rural development fee and infrastructure development cess on Basmati, which is the main reason behind increase in arrival. One of the senior official in state mandi board added that for the promotion of Basmati exports, the state government has exempted various taxes. Earlier, traders and millers used to procure the crop directly from the farmers in order to avoid these taxes, as a result mandis used to witness less arrival of Basmati.

He added that exemption of 2% Rural Development Fee (RDF), 3% of Punjab Infrastructure Development Fund and two per cent market fee would entail an extra expenditure to the tune of Rs 200 crore annually on the state exchequer.