We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry.
We focus on grains and food industry. current time
India’s declining basmati exports favour Pakistan
As the trade experts and analysts maintain, India and Pakistan have been competing fiercely for global demand for their long-grained variety of rice, known as the “basmati”, which fetches them a good lot of dollar.
Countries including Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates and the United States are the main buyers of basmati where it finds its way into everything from staple food to snacks to sweets.
The distinctive fragrance of basmati rice has made this long-grain and fragrant variety a staple grain of cooking in South Asia and beyond.
The top exporter India commands a 65 percent share of the world market while Pakistan is responsible for the rest. Basmati had been a major revenue driver for India with record earnings of $5.4 billion in 2023, up nearly 21 percent from the previous year due to higher prices and bumper production.
However, the basmati exports have been faltering since January this year, and may drop more as buyers delay purchases due to a surge in freight costs because of the shipping problems in the Red Sea.
Low rainfall so far this year, could also impact India’s rice output, the agriculture ministry indicated in February this, while India’s imposition of rice export restrictions in 2023 have also pushed down the rice shipments, traders said.
While India recorded 4.9 million tonne (mt) of basmati rice exports in 2023, the yield this year is expected to be lower. By contrast, Pakistan’s rice exports could surge to 5.0 mt, up from the last year’s 3.7 mt, according to the reports.
Indian basmati exporters were also hurt by the government’s imposition of a higher minimum export price (MEP) of $1,200 per tonne, up from $950, which led to a steep decline in overseas sales, said Vijay Setia, a former president of All India Rice Exporter Association of India.
“Over 80 percent of basmati rice exported was sold at rates lower than this MEP and Pakistan benefited greatly from this disruption,” Setia said. “Though the government made some favourable changes in the MEP later, but many small traders are still under the effect of the knee-jerk move.”
On the other hand, Pakistan, meanwhile, has dramatically increased its acreage for growing basmati rice which will likely send production soaring and take an even bigger bite out of India’s global share, said the traders.
The Indian Agricultural Reseach Institute (IARI) has recently reported, through its on-line videos, that the Pakistan growers are growing “illegally” the basmati rice varieties of basmati, which gives an edge to the Pakistan’s basmati over the Indian varieties. The factor also shows as a concern for Indian basmati growers and exporters at the same time.
