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Indian exporters fear Pakistan could seize control of basmati rice market

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1 year ago

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  • India maintains $1,200 a ton MEP for basmati rice.
  • Millers fear decision will hamper overseas sales.
  • India and Pakistan are the only growers of basmati rice. 

NEW DEHLI: Indian exporters have criticised their government for maintaining the current floor price for basmati rice, saying the move will allow Pakistan to capture the market.

India and Pakistan are the only growers of basmati rice. New Delhi exports more than 4 million metric tons of basmati – the premium long-grain variety famed for its aroma – to countries such as Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates and the United States.

New Delhi set a floor price, or minimum export price (MEP), of $1,200 a ton in August. It was expected to cut this MEP but the government on Saturday said it would maintain the floor price until further notice.

“Farmers find themselves in a frustrating predicament,” said a leading exporter who asked not to be named.

“We are empowering Pakistan to seize control of the basmati rice market in the short term.”

India, the world’s biggest rice exporter, has also curbed exports of non-basmati rice varieties in an attempt to keep a lid on domestic prices ahead of key state elections.

“We are staring at massive losses,” said Sukrampal Beniwal, who grows basmati varieties in the country’s north. “We have harvested our crop, but there are no buyers.”

Farmers plant summer-sown rice varieties in the rainy months of June and July and start harvesting their crops in October. As the new harvest trickles in, prices start to fall.

Farmers, millers and exporters had believed the government would lower the MEP, which they consider too steep, as the new-season crop comes to market.

“The decision to continue with the $1,200 MEP is a big blow to us,” said Vijay Setia, a leading exporter from the northern state of Haryana, one of India’s breadbaskets, adding that the government needed to cut it to $850-$900 a ton with immediate effect.

Basmati rice farmers are struggling to sell their produce because millers and traders have stopped coming to dozens of wholesale markets to buy, Beniwal said.

Paddy prices of basmati varieties have fallen more than 20% since the government imposed the MEP, traders said.

Basmati is not widely consumed in India and the government doesn’t buy the variety to build state reserves.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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2 days ago

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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