Rice seems to have emerged as a favourite diplomatic tool for India to build strong ties with its east- and south-Asian neighbours.
The commodity is the staple diet for most people in countries like Indonesia, Thailand and also neighbouring country Bangladesh.
Months after India okayed export of 300,000 tonnes of rice to Bangladesh at a standard price of Rs 20,000 per tonne on a diplomatic basis, the government has once again showed its keenness to export rice under the same channel, this time to Indonesia.
A delegation from Indonesia called on the food minister on Wednesday to press for exports of rice to meet its domestic shortage.
Just like the previous time, this time too, the consent to export rice has come days before Prime Minister Manmohan Singh visits Bali to participate in the East Asia and the India-ASEAN summit. The Prime Minister will be embarking on Indonesia-Singapore trip from November 17 to 20.
“India at the moment has enough foodgrain stock and may consider request of Indonesia,” Food Minister K V Thomas said in a statement.
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In July this year, an empowered Group of Ministers (eGoM) had okayed export of rice to Bangladesh through diplomatic channels just days before the Prime Minister was to visit that country.
The trigger for this largesse is simple. Rice stocks in the country are overflowing because of record production and procurement.
Though, the exports of non-basmati rice has been allowed under the open general license, albeit with an unofficial cap of around 2 million tonnes, but that is being done by private traders.
Official data showed that as on October 1, the country’s foodgrain stocks in central pool stood at a whopping 51.78 million tonnes, of which rice stocks were around 20.3 million tonnes and wheat around 31.42 million tonnes.
The stocks were more than double the amount under the buffer and strategic reserve requirement on the same date. Procurement for 2011-2012 crop marketing season is also underway, which could further pressure the stock position.
The Indonesian delegation was led by chairman of its National Logistics Agency, Sutarto Alimoeso.
Officials said the grains could be either directly purchased by Indonesia or exported on a government-to-government basis at cost.
For the later, consent from external affairs and commerce is needed as it will be through diplomatic channels. However, no quantity was discussed during the meeting.
The minister also raised the issue of high export tariff on edible oils in Indonesia and its negative fallout on India, as the country is one of the largest buyer of edible oils from Indonesia.