India, the world’s leading rice exporter, has imposed a new tax on overseas sales of the food staple in a bid to ensure sufficient domestic supply, the country’s Finance Ministry announced on Friday.
A 20% duty was placed on exports of parboiled rice, a pre-cooked variety of rice that accounts for about one-third of India’s total rice shipments. The duty took effect immediately and will remain in force until October 15.
The move comes a month after the Indian government suspended exports of all non-basmati white rice to temper domestic rice prices, which had jumped by more than 30% since October 2022. Last year, the country also banned exports of broken rice.
Experts warn that the new export duty, while beneficial for India’s domestic market, could inflate food prices globally.
“With this move, domestic prices will drop and that will help the government in controlling food inflation. But, global prices will rise and buyers will have to absorb the increase,” B.V. Krishna Rao, president of India’s Rice Exporters Association, told Bloomberg.
Rice prices reached their highest levels in nearly 15 years earlier this month amid supply concerns. According to data from the Thai Rice Exporters Association, on August 9 the price of Thai white 5% rice, an Asian benchmark, jumped more than 25% to $648 per ton, its highest level since October 2008.
While prices began to moderate in the following days, analysts expect them to rise again on news of the Indian duty.
For more stories on economy & finance visit RT’s business section
You can share this story on social media:
Follow RT on
Comments are closed.