Govt Curbs On Non-Basmati Rice Export Likely

The Union government plans to put restrictions on export of non-basmati rice as its overall production had been below target in 1996.

Commerce ministry sources said the proposal was due to come up before the Cabinet on Tuesday but deferred because there were already too many items on the agenda. The proposal has been put forward by the agriculture and civil supplies ministries.

According to the ministries proposal, total export of non-basmati rice is expected to be limited to 2 million tonnes in the coming year.Earlier, the government had banned export of wheat and wheat products.

In 1996-97, total wheat export had been about 1 million tonnes. International wheat prices crashed in the August-September period last year, which made it difficult for Indian exporters to sell their goods.

 

Following this, the government banned export between October and November.

Export of basmati rice and non-basmati rice stood at 48,8742 tonnes and 19,84,824 tonnes, respectively, in 1996-97.

Sources said such a move will hurt the overall agricultural exports. The target for agriculture and marine exports for the current year has been set at $ 4.4 billion.

Officials say, banning exports of these items will hurt the sector. With exports of wheat banned, basmati not doing too well and now, if non basmati are restricted or banned, chances of meeting these targets will be low, said the official.

Also, when these exports are limited/banned, Indian exporters lose their importing sources and the channels dry up for the future.

Already, the new cumulative recovery system (CRS) to come into effect in the European Union in July will hurt basmati exports.

India exports roughly 26,000 tonnes of basmati to the European Union at an average price of $ 800 a tonne.

Basmati exports have been under threat with different countries trying to pass off other qualities as genuine basmati.

In fact, basmati rice exports have been sluggish in 1996-97 compared with 1995-96, a particularly good year for rice.

The ministry in view of this and other threats to rice exports had scaled down its target for rice exports to Rs 2,400 crore in 1996-97. This was virtually half the total exports of Rs 4,553 crore achieved last year.