RICE EXPORTS
- According to the Third Advance Estimates of Production of Major Crops for 2022-23 released by the Department of Agriculture and Farmers Welfare, the total production of rice in India is estimated to be 158.95 lakh metric tonnes (LMT) against 184.71 lakh tonnes during rabi 2021-22.
- The production of rice in the Kharif season is estimated to be 384.05 lakh tonnes, while the production in the Kharif season is estimated to be 367.83 lakh tonnes in the last year
- The major states contributing to the production of rice are West Bengal, Uttar Pradesh, Punjab, Andhra Pradesh, and Odisha
- The increase in the production of rice is due to a number of factors, including favorable weather conditions, good agricultural practices, and government interventions such as the Pradhan Mantri Fasal Bima Yojana (PMFBY). The PMFBY is a crop insurance scheme that provides financial assistance to farmers in case of crop failure due to natural calamities
- India is the world's largest exporter of rice, accounting for about 45% of global rice exports in 2022. In 2022-23, India exported a record 22.3 million metric tonnes of rice worth $9.66 billion.
- The major destinations for Indian rice exports are Bangladesh, Vietnam, the Philippines, Malaysia, and Indonesia
- However, on July 20, 2023, India imposed a ban on the export of non-basmati rice, which accounts for about 10 million tonnes of India's annual rice exports. The ban was imposed to control rising domestic prices of rice and ensure adequate availability of rice for the domestic market
- The ban on non-basmati rice exports is likely to have a significant impact on the global rice market.
- It is expected to push up global rice prices and disrupt the supply chain for rice. The ban is also likely to benefit other major rice exporters such as Thailand, Vietnam, and Pakistan
- The Indian government has said that the ban on non-basmati rice exports will be reviewed periodically based on the domestic rice market situation. It is possible that the ban may be lifted if the domestic rice prices come down.
- The minimum support price (MSP) for paddy in India for the marketing season 2022-23 is Rs. 2040 per quintal for common paddy and Rs. 2060 per quintal for grade A paddy. The MSP is announced by the government of India every year to ensure that farmers get a fair price for their produce.
- The MSP is fixed at a level that is at least 50% above the all-India weighted average cost of production. This is to ensure that farmers get a reasonable return on their investment and are not forced to sell their produce at a loss.
- The MSP is also used by the government to procure paddy from farmers for the public distribution system (PDS). The PDS is a government program that provides subsidized foodgrains to the poor and vulnerable sections of the population.
India is the world's largest producer of basmati rice, accounting for over 70% of the world's production. The other major producers of basmati rice are Pakistan, Iran, and Thailand.
The total production of basmati rice in India in 2022-23 is estimated to be 5.609 million tonnes. The major states producing basmati rice in India are Punjab, Haryana, Uttar Pradesh, Himachal Pradesh, and Jammu and Kashmir
The export of basmati rice from India is a major contributor to the country's foreign exchange earnings. In 2022-23, India exported 4.559 million tonnes of basmati rice worth $3.852 billion. The major destinations for Indian basmati rice exports are Saudi Arabia, Iran, UAE, and Yemen.
The production of basmati rice in India is expected to remain stable in the coming years. However, the export of basmati rice may be affected by a number of factors, including the global economic situation, the trade policies of other countries, and the weather conditions in India.
The ban on non-basmati rice exports is likely to have a significant impact on the global rice market. It is expected to push up global rice prices and disrupt the supply chain for rice. The ban is also likely to benefit other major rice exporters such as Thailand, Vietnam, and Pakistan.
The Indian government has said that the ban on non-basmati rice exports will be reviewed periodically based on the domestic rice market situation. It is possible that the ban may be lifted if the domestic rice prices come down.
Here are some of the reasons why India imposed a ban on non-basmati rice exports:
- Rising domestic prices of rice: The prices of rice have been rising in India in recent months due to a number of factors, including a decline in production, increased demand, and speculation in the market. The ban on non-basmati rice exports is an attempt by the government to control rising domestic prices of rice.
- Ensure adequate availability of rice for the domestic market: India is a major rice-consuming country and the government is concerned about ensuring adequate availability of rice for the domestic market. The ban on non-basmati rice exports is an attempt to ensure that there is enough rice available for the domestic market.
- Protect the interests of farmers: The government is also concerned about protecting the interests of farmers. The ban on non-basmati rice exports is an attempt to ensure that farmers get a fair price for their produce.
