The Finance Ministry of India has imposed a 20% export duty on parboiled rice and specific varieties of milled rice starting May 1. As reported by Financial Express, the decision has been made to control the export of rice and prioritize domestic food security to balance international trade and ensure sufficient food supply within the country.
As outlined in the ministry’s circular, the export duty covers parboiled rice, including GI-recognized varieties and other types, as well as ‘Other Rice’ under designated customs classifications. This category encompasses semi-milled and fully milled rice, regardless of whether it is polished or glazed.
The decision follows earlier steps taken by the government to relax trade restrictions. In October 2023, authorities removed most of the export curbs that had been implemented since September 2022. However, the ban on broken rice exports remained in effect.
Alongside these changes, the government reduced the customs duty on parboiled rice from 10% to zero to encourage its export. Additionally, it eliminated the $490 per ton Minimum Export Price (MEP) previously applied to white rice. These adjustments were made after a high-level inter-ministerial meeting, reflecting the government’s effort to reform trade policies while maintaining specific limitations.
The alterations were adopted to alleviate the strain on warehouses in Haryana and Punjab, which were said to be overflowing with excessive rice stocks at the time.
India initially introduced measures to limit rice exports in 2022 by banning the exports of broken rice. This was subsequently accompanied by the introduction of a 20% export duty as part of a broad policy to curb food inflation. The newly implemented export duty seeks to improve the management of food grain availability domestically while also addressing challenges posed by fluctuations in global supply dynamics.
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