Plunge In Basmati Exports Feared

Basmati rice exports are in jeopardy. US-based company Uncle Benz has moved legally to use the name 'Basmati' and Pakistan has managed to get the same concessions from the European Union which are accorded to Indian rice exports to the region.

As loss of the Basmati brand will hit rice exports severely, the commerce ministry is considering seeking legal counsel from a London-based firm to fight the case.

Sources in the ministry said the move by Uncle Benz is the first direct and legal attempt to use the name Basmati for rice not produced in India. Earlier, US rice exporters had claimed that they had discovered a variety of long-grained rice equivalent in quality to Basmati. The variety had been developed in Texas and the exporters were calling it Texmati.

 

This did not pose any serious threat to the brandname, sources said. A delegation of commerce ministry officials and representatives of the rice exporters may visit the UK in this connection.

Basmati rice export is promoted mainly by an informal consortium known as the All India Rice Exporters' Association. Basmati exporters were already facing problems as exports this year were likely to be sluggish after the good showing in 1995-96.

In view of the fresh threats and the low exports anticipated, the commerce ministry has scaled down its target for rice exports to Rs 2,400 crore for the current financial year. This is about half the total exports last year which were worth Rs 4,553 crore.

The grant of duty reliefs to rice exports from Pakistan to the EU could divide the EU rice market between India and Pakistan. Under the regime, Indian basmati is eligible for a tariff concession of 250 ECU per tonne because of its high price. "If Pakistan gets parity, India's exports will be hurt," say senior officials.

India exports about 26,000 tonnes of basmati to the EU at an average price of $800 a tonne.