Mulling basmati minimum export price review: Govt

Sandeep Dikshit

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New Delhi, October 15

Faced with a virtual revolt from traders and exporters, the government on Sunday said it was considering a review of free on board (FOB) value for issue of registration-cum-allocation certificate (RCAC) for basmati rice by the Agricultural and Processed Food Products Export Development Authority (APEDA).

Based on the representations received from rice exporter associations that the high FOB value is adversely affecting the export of basmati rice from the country, Food Minister Piyush Goel met them and assured that a review is under active consideration of the government but the present arrangement will continue until an appropriate decision is taken.

The domestic as well as the export market of rice has witnessed volatility ever since the Centre undertook several measures to check the domestic prices of rice and ensure adequate availability for domestic consumers. One of the measures, now being opposed by rice exporters, is that contracts for basmati rice exports with the value of $1,200 per ton will only be registered from August 25.

In its defence, the government says this step was taken after receiving field reports regarding misclassification and illegal export of non-basmati white rice, exports of which were banned on July 20. Officials claimed in many cases, non-basmati white rice was being exported under the HS code of basmati rice.

Now, the new crop of basmati has started arriving and there is generally a decline in prices when the new crop starts arriving. In view of this development, the government has given signs of relenting.