India's rice exporters hope to boost shipments to US after tariff cut

Exporters expect improved competitiveness and higher shipments to the US after the proposed reduction in American tariffs on Indian goods to 18 per cent from 50 per cent

The proposed reduction in US tariffs on Indian goods to 18 per cent from the earlier 50 per cent has enthused India’s rice exporters, with traders expecting a tangible boost to competitiveness and shipment volumes to the American market. Though the US is not a very large market for Indian rice exporters, it is a valuable one.

 

In a statement released a short while ago, the Indian Rice Exporters Federation (IREF) welcomed the indication, calling it a significant reset in trade conditions at a time when India is entering the new season with record production and robust export readiness.

 

According to IREF data, India’s rice exports to the US showed robust growth despite the hike in tariffs to almost 50 per cent. It said that in FY25, India exported 274,213 metric tonnes of basmati rice to the US, valued at ₹2,849.16 crore, with an average realisation of ₹103,903 per tonne.

 

In dollar terms, basmati exports stood at $337.10 million, with an average rate of $1,229.33 per tonne. Non-basmati rice exports during the same period amounted to 61,341 metric tonnes, valued at ₹462.50 crore or $54.64 million, at an average rate of $890.73 per tonne.

 

The momentum continued into the current fiscal.

 

Between April and November 2025, basmati rice exports to the US reached 199,558 metric tonnes, valued at ₹1,749.17 crore or $201.13 million. Non-basmati shipments during this period stood at 40,960 metric tonnes, with a value of ₹284.12 crore or $32.71 million. “While average realisations softened compared to the previous year, volumes remained robust, reinforcing the view that Indian rice remains essential for US buyers and consumers,” IREF said.

 

Monthly shipment data further underscore this trend.

 

In September 2025, India exported 22,668 metric tonnes of rice to the US, compared with 21,329 metric tonnes in September 2024, even as values moderated. October 2025 saw a sharper jump, with volumes rising to 29,015 metric tonnes from 22,606 metric tonnes a year earlier.

 

November 2025 exports also exceeded the previous year at 24,156 metric tonnes versus 21,723 metric tonnes in November 2024. These gains came despite the imposition of a 50 per cent tariff, highlighting the structural strength of India’s rice export competitiveness.

 

According to IREF, if the proposed tariff structure is confirmed, it would effectively lower India’s tariff burden to 18 per cent, restoring parity with key competing origins such as Thailand and Pakistan, where rice shipments currently face tariffs of around 19 per cent.

 

The federation is also hopeful that an additional penalty being discussed in connection with India’s purchases of Russian oil may be waived, further easing the overall tariff environment for Indian exports to the US.

 

Akshay Gupta, head of bulk exports at KRBL, one of India’s largest rice exporters, said the recent announcement of the US–India bilateral trade deal marks an important and encouraging development for India’s agricultural export sector, particularly for the basmati rice industry.

 

The reduction in reciprocal tariffs from 25 per cent to 18 per cent, effective immediately, is expected to ease export-related cost pressures and provide much-needed support to pricing competitiveness.

 

“By enabling broader market access and fostering a more predictable, rules-based trade framework, such agreements can significantly strengthen exports of high-value agri-products, leading to improved value realisation across the supply chain and better outcomes for farmers,” Gupta said.

 

He said that from an industry standpoint, the removal of the additional 25 per cent duty that had been linked to geopolitical considerations is also a positive step towards normalising trade flows.

 

Rice exporters believe that, over the long term, initiatives like these will reinforce India’s standing as a trusted global food partner, support rural prosperity, and drive sustained growth across the agricultural economy.

 

Such parity is crucial in a price-sensitive commodity like rice. Exporters believe that a lower and more predictable tariff regime will directly translate into improved landed-price competitiveness, allowing Indian rice — both basmati and non-basmati — to compete more effectively against other origins in the US market.

 

IREF, meanwhile, said in its statement that it believes a tariff reset to 18 per cent would amplify this momentum, supporting stronger offtake across both basmati and non-basmati categories and enabling India to defend and expand its market share in the US.

 

Addressing concerns around potential additional tariffs linked to India’s trade with Iran, the federation noted that evolving trade frameworks often reflect broader strategic alignments rather than purely commercial factors. Based on current visibility, IREF does not anticipate further disruption to India–Iran trade and expects continuity in export flows.