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Rice Custom Duty to Continue, Domestic Availablity Paramount: Commerce and Industry of India

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Khushal.Tradologie
Rice Custom Duty to Continue, Domestic Availablity Paramount: Commerce and Industry of India

India accounts for more than 40% of the global rice trade. With a large number of rice exporters spread across its many states, India competes with countries like Thailand, Vietnam, Pakistan, and Myanmar in the global rice market. 

However, due to below-average rainfall in the vital rice-producing states of India, this Kharif season, the paddy acreage in states like West Bengal, Bihar, and Uttar Pradesh has been low. 

As a result, the paddy acreage fell by 2.1 million hectares as compared to the same period in the previous year*. This led to a shortage causing instability in the cost of rice in the domestic market making it harder for mill buyers to fulfill their bulk procurement demands.


Changes in Rice Export Policy 


The Government of India moved broken rice from the ‘free’ to the ‘prohibited’ category and also levied a 20% duty on non-basmati rice for rice importers across the world. However, no changes in policy took place concerning Basmati rice and Parboiled rice and if you are thinking of purchasing quality rice, you can Click Here to procure quality rice from relevant suppliers from a pool of 70,000 verified global suppliers in Tradologie’s network. 


With the duty levied, India’s rice shipments would become uncompetitive in the global market (dropping exports by more than 25%)** which would pave the way for competing countries like Thailand and Vietnam to take over the growing demand of buying bulk rice globally. 

India exports rice to more than 150 countries, so any reduction in its shipments would increase the already rising pressure on food prices because of unfavorable climatic conditions and Russia’s invasion of Ukraine. 


Current Scenario


Piyush Goyal, Union Minister for Commerce and Industry, Food and Public Distribution, on 28thOctober’22, said that the 20% export duty on Non-Basmati Rice Exporters, except parboiled rice, is unlikely to be taken up for a review until a clear picture depicts the impact of unseasonal rain on rice crops in Uttar Pradesh and Bihar.


The objective of the duty stated was to ensure domestic availability as well as stability in the prices while also continuing with the Centre’s free grain distribution program for the economically weak and any review of the nearly two-month-old duty levied would depend on the sowing figures from the parts of Uttar Pradesh and Bihar that received unseasonal rains this year.


Mr.Goyal, who also interacted with members of the Federation of Telangana Chambers of Commerce and Industry (FTCCI), responded to an appeal from the export trade industry for the withdrawal of the duty as it was hampering the business. He further said that taxpayers ought to be happy with how their money is being spent citing how the Centre has decided to give more rice to the poor. The Minister, who responded to queries from industry representatives before delivering a short speech, said the focus should be on the quality of products. “We should never compromise on quality... to become a trusted supplier [to the world], '' he said while underscoring the need to maintain one quality for supplies made to domestic and international consumers. 


To know more, call +91-8595957412 or reach out to us at https://bit.ly/3Ul5yEN To stay updated with the latest happenings in the agro-trade industry, follow Tradologie.com across all social media channels. 




REFERENCE- https://bit.ly/3U3Hcjc 

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