india exports face $5 billion shortfall, basmati rice shipments at risk due to Red Sea attacks
Published on: December 22, 2023.
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India’s Export Shortfall May Reach $5 Billion Due to Trade Restrictions
India is expected to face a shortfall of approximately $4 billion to $5 billion in exports this year as a result of curbs on trade in wheat, rice, and sugar. In addition to this, basmati rice shipments may also be impacted by the recent attacks in the Red Sea, according to a report by Reuters. India, the world’s second-largest producer of wheat, rice, and sugar, has imposed restrictions on exports in an effort to control rising domestic prices.
Speaking about the situation in the Red Sea, Arindam Bagchi, spokesperson for the Ministry of External Affairs (MEA), stated that India has always been supportive of the free movement of commercial shipping. The government is closely monitoring the developments in the region and is actively participating in international efforts to ensure the safety of shipping routes.
If attacks by Yemen’s Houthi group continue, the government may consider using an alternate route along Africa for basmati rice shipments. The report suggests that this could cause prices to increase by around 15% to 20%. The alternate route may also impact India’s exports of long-grain rice to Egypt and Europe.
However, despite these challenges, India anticipates that growth in exports of other farm commodities will offset the export deficit this year. Rajesh Agarwal, an additional secretary in the trade ministry, stated that exports excluding controlled agricultural commodities like wheat and rice are growing by over 4%. As a result, India should still be able to meet last year’s export levels, despite the $4 billion to $5 billion shortfall caused by the restrictions on sugar, wheat, and rice.
Data from the Agricultural and Processed Food Products Export Development Authority (APEDA) showed that exports of meat and dairy products, cereal preparations, and fruits and vegetables have increased between April and November this year.
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Source: [Livemint](https://www.livemint.com)
