The Federation of Telangana Chambers of Commerce and Industry (FTCCI) has appealed to the Centre to re-examine the 20% duty on rice exports.
The duty on brown and white rice other than basmati and parboiled varieties covers nearly 60% of the country’s total exports. With the levy, Indian rice shipments will become uncompetitive in the global market and buyers will shift to Thailand and Vietnam, FTCCI said in representation to Union Minister of Finance Nirmala Sitharaman and Union Minister of Commerce and Industry Piyush Goyal.
Stating that there are several hundred varieties of non-basmati rice in the country with the price of some “much higher than basmati rice. Some non-basmati variants sell for $700-1,400 per tonne. Levying a duty on these variants will prove very expensive. It will have many adverse outcomes for team India in the long term,” FTCCI President Anil Agarwal said.
He said such a blanket duty would come in the way of Indian rice exporters getting a foothold in new markets for premium non-basmati segments. “Lack of price competitiveness with exporters from other countries will destroy them. Also, the farmers and exporters from rice surplus States like Telangana will be affected severely due to losing of market for their competitors from other countries,” he said.
The Centre had recently imposed the 20% duty to discourage buyers and to secure domestic supplies. The decision came after Food Ministry recommended the levy to ensure sufficient rice stock for public distribution system and Pradhan Mantri Garib Kalyan Anna Yojana. FTCCI said since the shortage is envisaged for varieties of rice meant for PDS and PMGKAY, “we suggest to impose duty according to the export price of rice and a blanket duty on all non-basmati rice variants must be avoided.”
India is the world’s biggest rice exporter with the exports touching 21.5 million tonnes in 2021 or more than the combined shipments of the world’s next four biggest rice exporters – Thailand, Vietnam, Pakistan and the U.S, the trade and industry body said.