Mahiyar Patel, Pune
The finance ministry put out an official notification on Friday levying a sharp export duty on parboiled rice. The duty hike has taken place following the ban on the export of non-basmati white rice and broken rice in September 2022, which had been imposed because of extreme surges in the price of the essential commodity. The export duty currently announced will be effective until October 15, 2023.
Non-basmati rice is 80% of the total amount of rice being exported. India exports rice to more than 100 countries. Some of the major importers are Bangladesh, China, Nepal, Iran, and most African countries.
The intention behind this move is to calm prices in the domestic market and incrementally add to the local inventory of rice. Higher rice prices cause an extremely high inflationary reaction in the domestic market. Prices of parboiled rice have risen 19% since April domestically and 26% internationally. The government’s efforts to control inflation in cereals are being done in two ways. One, stopping or greatly restricting exports. Two, it has been releasing large amounts of reserve stock from the state granaries.
India exported 7.4 million tons of parboiled rice in 2022. The country holds almost a 40% share of the world rice export market. In July, the United Nations food agency’s rice price index jumped to the highest level it has been in 12 years. This has been caused by a number of rice-producing nations like India and Myanmar placing prohibitively high export duties. The price rise could seriously affect countries with acute food insecurity and malnutrition.