“India prolongs 20% export tax on parboiled rice until March”
Published on: October 14, 2023.
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Extension of 20% Export Duty on Parboiled Rice by India Until March
The central government of India has made a decision to extend the 20% export duty on parboiled rice until March 31, 2024, as per an official announcement.
Parboiled rice is a partially boiled rice with husk. The export duty was originally implemented on August 25, 2023, with an initial plan to stay effective until October 16, 2023. This move aimed to ensure sufficient domestic availability of rice and control its price.
Amendment in Rice Export Norms
India made some changes to its rice export norms in July. It categorized non-basmati white rice as a “prohibited” item. The policy around the export of non-basmati white rice (semi-milled or wholly milled rice, irrespective of being polished or glazed) was shifted from “free” to “prohibited”.
Nevertheless, the government will allow exports on a case-by-case basis, specifically when granted permission by the government to address food security needs of other nations, upon their request.
Major Importers of Indian Non-Basmati Rice
West African nation, Benin, is known to be one of the biggest importers of India’s non-basmati rice. Other countries that heavily rely on India for their rice import include Nepal, Bangladesh, China, Cote D’ Ivoire, Togo, Senegal, Guinea, Vietnam, Djibouti, Madagascar, Cameroon, Somalia, Malaysia, Liberia, and UAE.
Additional Safeguards on Basmati Rice Export
In the late August, India further safeguarded the export of basmati rice in an effort to halt the export of non-basmati white rice. This was in response to credible field reports of misclassification and unlawful exports of non-basmati white rice. It was reported that non-basmati white rice was exported under the HS codes of parboiled rice and basmati rice.
Instructions to APEDA
In light of these concerns, the government has directed APEDA, the regulator of agricultural produce exports, to introduce additional measures to stop potential illegal exports of white non-basmati rice disguised as basmati rice. Additionally, it was suggested that contracts for basmati exports should maintain a minimum value of USD 1200 per tonne for the issue of Registration-cum- Allocation Certificate (RCAC). Contracts valued below USD 1200 per tonne, however, should be kept on hold and be subject to review by a committee set up by the Chairman of APEDA.
Ban and Duty on Broken Rice and Non-Basmati Rice
An interesting move to note, India in September 2022 had imposed a ban on the exports of broken rice and levied a 20% duty on non-Basmati rice export, with the exception of parboiled rice. This action was driven by concerns about overestimated low production due to a decrease in the paddy crop area. However, the ban was lifted in November.
