Pakistan Rupee Exchange Rate
Indian exporters have expressed disappointment with the Modi government for maintaining the current floor price for basmati rice. And they believe that this decision will allow Pakistan to gain a stronger foothold in the market.
Indian exporters are worried as the Government of India is not listening to them regarding the capping of rice exports. India and Pakistan are the exclusive growers of basmati rice in the world, with India exporting over 4 million metric tons of this premium long-grain variety to various countries.
In August, New Delhi set a minimum export price (MEP) of $1,200 per ton, and there were expectations that this MEP would be reduced. However, the government announced on Saturday that it would keep the floor price in place until further notice.
This decision has left farmers and exporters concerned about the implications, as they fear it empowers Pakistan to take control of the basmati rice market. With the MEP considered too high, they had anticipated a reduction as the new harvest season began.
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The decision to maintain the $1,200 MEP has caused frustration and disappointment, with many calling for an immediate reduction to a more reasonable level, such as $850-$900 per ton.
Basmati rice farmers are currently struggling to sell their produce, as millers and traders have stopped visiting wholesale markets to make purchases.
Prices of basmati varieties have fallen by more than 20% since the MEP was imposed. Basmati rice is not widely consumed in India, and the government does not purchase it to build state reserves.
On the other hand, despite significant production losses and other major challenges, Pakistan exported a total of 3.717 million tonnes of rice to earn $2.149 billion in FY23.
