India abolishes export tax on parboiled rice: a significant impact is expected on international markets

By: Trademagazin Date: 2024. 10. 25. 10:42

The Indian government recently announced that it will abolish the export tax on parboiled rice. The decision is justified by growing rice stocks and the expected record harvest after this year’s monsoon rains, which may favorably affect both the domestic and international rice markets, Reuters reported. India, the world’s largest grain exporter, has already taken steps to boost exports in the past month in a bid to moderate global prices and increase rice supply.

India’s steps to boost export market

Last month, India cut the tariff from 20% to 10% and allowed exports of non-basmati white rice with a minimum price of $490 per tonne. According to experts, if a high yield is still expected due to favorable weather, the government may even abolish this minimum price. This measure would further increase global rice supply, easing international prices and stabilizing supply on the world market. According to Dev Garg, vice-president of the Rice Exporters Association of India, the removal of the export tax shows the government’s confidence in this year’s crop.

Effects of parboiled rice exports

Parboiled rice exports in India fell by 13% to 5.1 million tonnes in the first eight months of 2024, a major decline. B.V. Krishna Rao, president of the Rice Exporters’ Association, believes that the duty exemption could encourage price-sensitive African buyers in particular to increase their purchases. Removing the export duty could improve India’s competitiveness in this market, contributing to stable prices and increasing demand for Indian rice.