Fact Sheet on Amendment in India’s export policy on Rice

Source: The post is based on the article “Fact Sheet on Amendment in India’s export policy on Rice” published in PIB on 23rd September 2022

What is the News?

Recent changes in India’s rice-export rules have helped keep a check on domestic prices without reducing the availability for exports. 

What are the changes made in the rice export rules?

India has banned the export of broken rice and imposed a 20% export duty on non-Basmati rice except for parboiled rice to boost domestic supplies amid a fall in area under paddy crop in the current kharif season.

It has not made any changes in the policy relating to par-boiled rice and Basmati rice.

What was the need for these changes?

Significant rise in export of broken rice: There has been a rise in global demand for broken rice due to the geopolitical scenario which has impacted the price movement of commodities including those related to animal feed. 

Meet domestic requirements under Ethanol Blending Programme: Food Corporation of India has been allowed to sell rice to ethanol plants for fuel ethanol production. However, in the current year, there has been a shortage of broken rice which impacted ethanol production.

Contain impact on poultry sector due to rising prices: Domestic price of broken rice has increased. Due to this, the poultry sector and animal husbandry farmers were impacted the most due to the price hike of feed ingredients as about 60-65%inputs cost for poultry feed comes from broken Rice. 

The domestic prices of Rice are showing an increasing trend and they may continue to increase due to the low production forecast of Paddy and an 11% increase in export of Non-basmati compared to the corresponding period of last year.