The Central government has issued fresh instructions to the Agricultural & Processed Food Products Export Development Authority (APEDA) to introduce additional safeguards to prevent the possible illegal exports of white non-basmati rice in the garb of basmati rice.

APEDA has been told that contracts for basmati exports with the value of $1200 per MT only and above should be registered for issue of Registration- cum-Allocation Certificate (RCAC).

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Contracts with the value of below $1200 per MT may be kept in abeyance and evaluated by a committee to be set up by the Chairman, APEDA, for understanding the variation in prices and the use of this route for export of non-basmati white rice, a press note today said.

The press note said it has been noted that there has been large variation in the contract price of basmati being exported with lowest contract price being $359 Per MT in the backdrop of average export price of $1214 per MT during the current month.

The committee should submit its report within a period of one month, after which a decision on lower price exports of basmati planned by industry can be taken appropriately.

”APEDA should hold consultations with trade to sensitise it about the matter and work with it to discourage any use of this window for export of non-basmati white rice,” the press note said.

To check the domestic prices and to ensure domestic food security, the Government has been taking measures to restrict export of rice from India. The export of non-basmati white rice was prohibited on 20 July.

It has been noticed that despite restrictions on certain varieties, rice exports have been high during the current year. Up to 17 August, total exports of rice (other than broken rice, export of which is prohibited) were 7.33 MMT compared to 6.37 MMT during the corresponding period of previous year, registering an increase of 15.06 per cent. There has been a spurt in the export of parboiled rice and basmati rice; both of these varieties did not have any restriction on exports.

While the export of parboiled rice has grown by 21.18 per cent (3.29 MMT during the current year compared to 2.72 MMT during previous year), the export of basmati rice has increased by 9.35 per cent (1.86 MMT during the current year compared to 1.70 MMT during previous year). The export of non-basmati white rice, which had an export duty of 20 per cent since 9 September 2022 and has been prohibited w.e.f. 20 July 2023, has also registered an increase of 4.36% (1.97 MMT compared to 1.89 MMT during previous year).

On the other hand, as per third Advance Estimate of the Department of Agriculture & Farmers Welfare, during the Rabi Season 2022-23, the production was only 158.95 LMT against 184.71 LMT during Rabi Season of 2021-22 i.e., there was a decline of 13.84 per cent.

Internationally, due to strong demand from Asian buyers, production disruptions registered in 2022/23 in some major producing countries like Thailand, and fears of possible adverse effects of the onset of El Nino, international rice prices have also been rising continuously since last year.

The government has received credible field reports regarding misclassification and illegal export of non-basmati white rice, export of which has been prohibited with effect from 20th July 2023. It has been reported that non-basmati white rice is being exported under the HS codes of parboiled rice and basmati rice.