The government may review the cess on basmati exports of Rs 8,000 a tonne following a dip in the shipments of the premium variety rice, grown only in India and Pakistan.
“The government will have a re-look at both export duty and minimum export price (MEP) of Basmati,” a senior official said. He, however, declined to give the exact time frame by which it would be done.
Besides the cess of Rs 8,000 a tonne, basmati exporters have to follow the MEP of $1,200 a tonne for contracting any shipment.
According to the official data, India’s basmati exports have dipped to 715,000 tonne during the current fiscal till December 21, compared with 751,000 tonne during the same period in the last fiscal.
The All India Rice Exporters Association has been demanding the removal of the export cess. It had warned that the shipments would fall further as Indian basmati would not be competitive in the international market, particularly in the Gulf region and in Europe, while Pakistan will exploit the situation with cheaper basmati prices.
Exporters welcome the decision to review the export duty. “Even if late, the government finally realised what impact the duty could have on export,” an industry official said.
Meanwhile, the Centre has procured over 15.5 million tonne of rice till today in the current season, against 12.8 million tonne in the year-ago period. Punjab has contributed 8.1 million tonne rice, the maximum among all the states, to the Centre’s buffer stock.