Govt Removes Minimum Export Price on Basmati Rice

New Delhi: The government on Friday said the USD 950 per tonne minimum export price (MEP) on basmati rice has been removed.

Commerce and Industry Minister Piyush Goyal said the move will help boost exports and increase farmers' income.

"It has been decided to remove current minimum export price (MEP) of USD 950 MT for issuing Registration-cum-Allocation Certificates (RCAC) for export of Basmati Rice," according to a communication from the Department of Commerce.

The APEDA was requested to take immediate action to implement the decision.

However, it added that APEDA will closely monitor export contract for any non-realistic prices for basmati exports.

The government on Friday also scrapped a minimum price threshold that it had set previously for exports of onion as it looked to pass on the benefit of international glut to Indian farmers.

The Minimum Export Price (MEP) in India is applied to a variety of commodities, including: 

Honey
The government imposed an MEP of USD 2,000 per metric ton on natural honey exports until December 31, 2024. This was to ensure that exports of natural honey were not below this value. 

Potatoes
In 2014, the government imposed an MEP of USD 450 per metric ton on potatoes to increase domestic supplies. This price was removed after almost eight months due to a surplus supply and rapid price fall. 

Earlier in October last year, the government reduced the floor price for basmati rice exports to USD 950 per tonne from USD 1,200 per tonne amid concerns that higher prices were hurting outward shipments.

The government on August 27, 2023 decided not to allow exports of basmati rice below USD 1,200 per tonne to restrict possible "illegal" shipment of white non-basmati rice in the garb of premium basmati rice.

India's total exports of basmati rice stood at USD 4.8 billion in 2022-23 in terms of price, while in volume terms it was at 45.6 lakh tonne.

It was USD 5.9 billion in 2023-24.

As per the Foreign Trade Policy, APEDA is mandated to register all contracts for the export of basmati rice and then it issues registration-cum-allocation certificate for the export of basmati rice.

The basmati crop is grown in kharif season. 

With PTI Inputs