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The New Imposition – India imposes a ban on export of broken rice and a 20% export duty on non-Basmati rice

The New Imposition – India imposes a ban on export of broken rice and a 20% export duty on non-Basmati rice

Rice being the staple food of the world, India ranks second highest in its consumption following China. India consumes approximately about 100 million tons of rice annually which turns out to be 80% of the country’s produce. In order to satiate the country’s population and not suffer from insufficient food to feed its very own people, the government mandates certain norms. The scarcity of food that leads to a lack of consistent access to enough food for an active and healthy life is termed food insecurity. Every country plans the amount of food it requires and after attaining self-sufficiency, it plans on export.
Food insecurity or shortage of food may happen when not enough food is produced which could be due to various reasons of natural disasters like flood, drought, lesser yield, due to pests, too much moisture, and such others. India’s rice production in this Kharif season has pegged at a level lesser than that of the previous year which can cause an impact on the crop prospects and price inflation. The trend of rice production has been negative as the area under the paddy crop cultivation has dropped by about 6 percent roughly in the current Kharif season. This is due to poor rains in some of the major rice producing states as per the data released by the Ministry of agriculture.
India produces numerous varieties of rice and can cater to all customer groups, and Indian rice is competitive in the global market due to its price and amiable quality. However, the Indian Government imposed a ban on the export of broken rice and a 20% duty on the export of non-Basmati rice dated September 8, 2022. This prohibition on the export of rice came into effect on September 9, 2022. The reason behind this imposition against the existing Foreign Trade Policy 2015-2020 is to eliminate the painful sensation caused by insufficient food energy consumption. As a contingency plan, the government imposed a new notification as the production went down compared to the previous year. Nevertheless, this imposition does not apply to the export of parboiled rice amid a fall in area under paddy cultivation in the present Kharif season.
Although a ban has been imposed on the export of broken rice certain exemptions were mentioned in the notification. As per the notification, certain consignments of broken rice where loading on ships or billing done prior to the notification will be allowed to be exported. 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, as per the extended statement. Keeping in mind food security and to boost domestic supply the notification was put into effect amid the fall in cultivation areas.

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