Home India India imposes export curbs on rice as domestic prices rise & paddy...

India imposes export curbs on rice as domestic prices rise & paddy area shrinks

Twenty per cent export tax on several varieties of rice. 'Circumstances exist which render it necessary to take immediate action', says revenue dept notification.

A farmer makes bundles of rice saplings | Credit: ANI Photo
A farmer makes bundles of rice saplings | Credit: ANI Photo

New Delhi: India, the world’s largest exporter of rice, Thursday imposed a 20 per cent export tax on several varieties of rice in a bid to tame domestic prices.

According to a notification issued by the department of revenue, all export of paddy (unmilled rice), brown rice and milled rice — except parboiled and basmati rice — will attract a 20 per cent export duty beginning 9 September.

“The central government is satisfied that export duty should be levied on certain articles and that circumstances exist which render it necessary to take immediate action,” the notification said.

The development comes at a time when the price of rice has shot up not only because of higher demand from Bangladesh, Iran, Iraq, and Saudi Arabia but also due to the lower paddy acreage in several states. 

The curb on rice exports follows lower and late planting of paddy due to uneven rains, particularly in states such as Uttar Pradesh, Bihar, West Bengal, and Jharkhand.

According to the agriculture ministry, as on 2 September, planting of rice in the ongoing Kharif crop season has been 6 per cent lower than last year.

The export duty on rice exports follows India’s ban on wheat export in May — a move that came after a heat wave led to a lower harvest.

Data from the consumer affairs ministry shows that retail rice prices rose by 5.7 per cent year-on-year (as on 8 September) while wholesale rice prices were higher by 7.8  per cent in the same period.

India is the second largest producer of rice in the world after China and is the top exporter with 40 per cent share in the global rice trade. It has targeted to produce 112 million tonnes of rice in the ongoing Kharif crop season spanning June-October.

In 2021-22, India exported over 21 million tonnes of rice worth Rs 72,000 crore. Out of this, non-basmati rice accounted for over 80 per cent of total rice exports in volume.

(Edited by Uttara Ramaswamy)


Also Read: Ban on wheat export is tyranny. It stops farmers from getting a windfall from higher prices