India has scrapped the minimum price for Basmati rice shipments, which will help boost exports, increase farmers’ incomes and enhance the competitiveness of the premium variety in global markets.
India is the world’s largest exporter of rice, and the move is expected to lower global prices for the variety, which is mainly grown in the Indian subcontinent and commands a premium over other rice varieties due to its longer grain size and unique aroma.
“The current minimum price of $950 per tonne, which was a condition for obtaining export certificates, has been removed,” Commerce Minister Piyush Goyal said in a post on Friday, adding that the decision “will help boost basmati rice exports and increase farmers’ income.”
In contrast, India continues to limit exports of non-Basmati rice to maintain domestic price stability.
India began banning or adding taxes on exports of key rice varieties in 2022, in an attempt to shore up supplies and calm food price inflation ahead of national elections at the time.
The moves pushed the Asian benchmark price of rice last year to its highest level since 2008, and prompted panicked consumers to seek supplies from other countries.
The latest decision comes ahead of elections in October in the northern state of Haryana, a major producer of basmati rice and other agricultural commodities. About two-thirds of India’s 1.4 billion people live in rural areas, making farmers a key voting bloc.
Separately, the country has removed the minimum price of $550 per tonne for onion exports with immediate effect, according to a commerce ministry notification.
The government has also reduced wheat stock limits to prevent hoarding, along with reducing food grain prices in the local market, according to a statement from the Ministry of Food.
Last updated: September 15, 2024 – 10:38
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2024-09-17 16:42:29