India Bans Export Of Broken Rice, After 20% Export Tax Amid Drought In 4 States

After imposing 20 per cent export duty on non-basmati rice, the government has banned the export of broken rice with an aim to increase domestic availability, according to a government notification.

"Export policy of broken rice ...is amended from ‘Free' to ‘Prohibited'," the Directorate General of Foreign Trade (DGFT) said in a notification dated September 8, 2022.

The notification comes into effect from September 9, 2022.

Provisions under the Foreign Trade Policy 2015-2020 regarding the transitional arrangement shall not be applicable to this notification, it added.

The notification also said, during the period September 9-15, certain consignments of broken rice will be allowed to be exported.

Consignments will be be allowed for exports during this period where loading of broken rice on ships has commenced before this notification, where the shipping bill is filed and vessels have already berthed or arrived and anchored on Indian ports and their rotation number has been allocated before this order.

Exports will also be allowed in case the consignment has been handed over to the Customs before this notification and is registered in their system, it said.

The approval for loading in such vessels will be issued only after confirmation by the port authorities concerned regarding anchoring/berthing of the ship for loading of broken rice prior to the notification.

The government on Thursday imposed a 20 per cent export duty on non-basmati rice except for parboiled rice to boost domestic supplies amid a fall in area under the paddy crop in the current Kharif season.

According to a notification by the revenue department, an export duty of 20 per cent has been imposed on 'rice in husk (paddy or rough)' and 'husked (brown) rice'. The export duty comes into effect from September 9.

The area under the paddy crop has been down by 5.62 per cent at 383.99 lakh hectare in the ongoing Kharif season so far due to poor rains in some states, as per the latest data released by the agriculture ministry.

India, the world's second-largest rice producer after China, commands a 40 per cent share in the global trade.

The country exported 21.2 million tonne of rice in 2021-22, of which 3.94 million tonne were basmati rice. It exported non-basmati rice worth USD 6.11 billion in the same period, as per official data.

The country exported non-basmati rice to more than 150 countries in 2021-22.

Paddy is the main Kharif crop, sowing of which begins with the onset of the southwest monsoon in June and harvesting starts from October onwards.

Rice production rose to a record 130.29 million tonne in the last crop year as against 124.37 million tonne in 2020-21.

The government has already restricted exports of wheat.