Nepal to send tomatoes to India amid price hike, asks for rice in exchange

In a give and take strategy, India and Nepal are helping each other amid a record-high spike in prices of commodities such as tomatoes and rice in the respective countries. In view of the rising prices, India has started importing tomatoes from Nepal, while the Himalayan country has written to the Indian government to extend its aid in return by sending rice and sugar.

Finance Minister Nirmala Sitharaman while replying to the no-confidence motion in the Lok Sabha informed that India has started importing tomatoes from Nepal amid the growing prices across the country. She further informed that the first lot of tomato imports from Nepal is likely to reach northern Indian cities, including Varanasi, Lucknow and Kanpur. 

In addition to this, the Union minister also assured that the prices of tomatoes in Delhi-NCR will come down to Rs 70 per kg as the government is procuring them from Maharashtra and Karnataka and distributing them in the national capital, Bihar, Uttar Pradesh, West Bengal and Rajasthan through NAFED and other cooperative societies.

In the past three months, the prices of tomatoes have surged more than 1,400% at the wholesale market to a record Rs 140 per kg, with farmers citing reasons including poor rainfall, higher temperatures and a virus outbreak that have hit the crop. The tomato prices even rose to Rs 300 per kg in many states. 

Why Nepal wants India to send rice? 

The Nepal consumers were severely impacted after the Indian government on July 20 imposed a ban on non-basmati rice export in  order to decrease its market value in India. Following this, the Nepali traders increased the prices of rice extensively to gain profits. Notably, India, the world’s largest rice exporter, banned the exports of non-basmati rice, to lower the surging domestic prices and “ensure adequate domestic availability at reasonable prices.”

Nepal is highly dependent on India to fulfill its rice needs. According to a report by the Indian government, Nepal imported 1.4 million tonnes of rice – 1.38 million tonnes of non-basmati and 19,000 tonnes of basmati rice – from India in the 2021-22 fiscal year, the highest import on record. 

It has been reported that immediately after India stopped the export of rice, retail prices of rice jumped by Rs 200 to Rs 250 per 25-kg bag in Nepal. The prices are also expected to increase further in the neighbouring country as the festive season is approaching.