India continued to be the world’s top rice exporter in 2023 despite banning shipments of white rice and imposing a 20 per cent duty on parboiled rice, according to the Thailand Rice Exporters Association (TREA). However, its share in the global market declined as shipments fell by 27 per cent. 

 

TREA honorary president Chukiat Opaswong told media in Bangkok earlier this week that India exported 16.5 million tonnes (mt) of rice in 2023, continuing at the pole position. The shipments, including basmati, were against a record exports of 22.3 mt in 2022. 

 

Opaswong said Thailand, Vietnam and Pakistan filled up the void caused by India’s curbs. Thailand emerged as the second-largest exporter, shipping out 8.8 mt, Vietnam third with a record 8.3 mt exports and Pakistan the fourth-biggest shipper. 

 

Scaling down export estimates

However, India is expected to be back in the global rice market later this year and ship out more, the TREA official said, adding that Vietnam and Thailand will compete for the second spot exporting about 7.5 mt, while Pakistan could maintain its shipments at 5 mt. 

 

Thailand, Vietnam and Pakistan will continue to command over $600 a tonne for their rice as long as Indian curbs are in place, Opaswong said.  Generally, barring Pakistan and Thailand’s 25% broken white, rice prices are ruling over $600 a tonne.

 

On the other hand, El Nino, which set in June last year, could affect production if drought and dry periods extend in Thailand. Not just Thailand, the El Nino weather pattern, expected to turn neutral by June this year could impact paddy in India, Pakistan and Vietnam too. 

 

Prices moving up

India’s rice exports were curbed by the Centre banning shipments of white rice from July and imposing 20 per cent export duty on parboiled rice. It also fixed a minimum export price of $950 on basmati shipments.

 

India resorted to these measures as its kharif paddy was affected by a deficient south-west monsoon. The Ministry of Agriculture and Farmers Welfare has estimated kharif rice production 3.8 per cent lower at 106.31 mt against 110.51 mt in 2022. The decision was taken to curb rising food prices too. 

 

Despite the supply curbs, Indian parboiled rice, the only variety available in the global market, is currently selling at $543-547 a tonne compared with Thailand’s $626 and Pakistan’s $637-641. The price includes the 20 per cent export duty.’

 

'The rice market is moving up and despite the Red Sea crisis, cargoes to West Asia, South-East Asia and Africa continue to go. Demand for parboiled rice is better than last year,' said VR Vidya Sagar, Director, Bulk Logix. 

 

Brown rice gains

In the domestic market, parboiled is available at ?33,000-34,000 a tonne including handling charges, he said. 'There is no problem with parboiled availability,' he said.

 

M Madan Prakash, President of the Agricultural Commodities Exporters Association, said Indian exporters were indulging in 'cut-throat' competition and he is not looking to ship rice now. 'There are some enquiries for brown rice but I have not responded,' he said.

 

Sagar said Vietnam is buying brown rice, priced around the level of parboiled for human consumption. Brown rice too attracts 20 per cent export duty.

 

According to the Agricultural and Processed Food Products Export Development Authority (APEDA), non-basmati rice exports during April-December 2023 dropped by 28 per cent to 8.34 mt valued at $3.34 billion against 13.18 mt valued at $4.66 billion. Basmati exports during the same period were up 19 per cent at 3.97 mt valued at $3.97 billion against 3.20 mt valued at $3.34 billion.

India has allowed exports of onions on government-to-government basis to some countries, on recommendation of the Ministry of External Affairs, said people aware of the matter.

 

One of the persons said a limited quantity of onion exports has been allowed for bilateral purposes though no decision has been taken on lifting a complete ban on onion exports. Details of the exporting agency could not be ascertained.

 

Another person said the government has permitted exports of onions in limited quantities to Bangladesh, Sri Lanka, Mauritius, Bahrain, Bhutan and Nepal, among others.

 

India, the world's second largest onion exporter, had banned shipments of the kitchen staple in December 2023 till March 2024 due to rising domestic prices and potential shortages. This led to a surge in onion prices in neighbouring countries.

 

As onion prices started to rise in August 2023, the finance ministry imposed a 40% export duty to curtail shipments. However, it failed to have the desired effect due to under invoicing, prompting the government to impose a minimum export price of $800 per tonne on onions effective October 28.

 

With severe rain and hail storms damaging the crop in places such as Nashik and Ahmednagar in Maharashtra, onion arrivals fell in the peak season in November, inflating prices and forcing the government to ban shipments of the bulb vegetable effective December 8.

 

This has led onion prices to crash from more than Rs.40 a kg to about Rs.13 currently in the wholesale market of Nashik, India's main onion-growing region, prompting onion farmers to protest for two months demanding lifting of the export ban.

 

Onions have 0.6 percentage points weightage in overall inflation and 10 percentage points in the vegetable basket. A rise in onion prices can push food inflation up causing concern for the government which is going to face voters in Lok Sabha elections in a few months.

 

In early February, a team of central government officials visited the onion growing regions of Maharashtra. The team was expected to make a recommendation to the government on the export ban.

 

Meanwhile, some large exporters wrote to the government on Sunday, suggesting that instead of completely banning onion exports, the government should permit outward shipments on a restricted basis, adding that any major export volume can lead to a significant price rise in the domestic market.

From its modest beginnings with annual exports of USD 0.6 billion in exports during 1987-88, proactive interventions by the Agricultural and Processed Food Products Export Development Authority (APEDA) have taken agricultural exports to a remarkable figure of USD 26.7 billion in the fiscal year 2022-23. This journey of exponential growth is underscored by expanding the export basket to over 200 countries, showcasing a commendable Compound Annual Growth Rate (CAGR) of 12%.

 

In the fiscal period 2022-23, India's agricultural exports reached USD 53.1 billion, with APEDA contributing a significant 51% of India’s Agri-exports. In the period April-December, 2023, among the 23 Principal Commodities (PCs) in APEDA's export basket, 18 exhibited positive growth. Notably, 13 out of 15 large PCs, with exports exceeding USD 100 million in the previous year, experienced positive growth, with an average growth rate of 12%. Fresh fruits emerged as a standout performer, registering a remarkable growth of 29%. Moreover, the export of processed vegetables surged by 24% in the period followed by Miscellaneous processed items, Basmati Rice, and Fresh Vegetables also saw substantial growth compared to the corresponding period last year. Notably, India has significantly expanded its fresh fruits export footprint, now serving 111 countries compared to 102 destinations in the previous year.

 

On its 38th Foundation Day on 13.02.2024, APEDA commemorated a remarkable journey of fostering agricultural exports, culminating in significant milestones and unprecedented growth. Founded in 1986 with the mission to promote the export of agricultural products, APEDA has evolved into a pivotal force in catapulting India's agricultural exports to new heights.

 

During April-November 2023, several key commodities witnessed substantial growth compared to the previous year, like, Bananas: 63%, Lentils (dried and shelled): 110%, Fresh eggs: 160% and Kesar and Dasheri Mango: 120% and 140%, respectively.

 

During the period from April to December 2023, the export value of Basmati rice surged by 19%, reaching USD 3.97 billion compared to USD 3.33 billion in the previous year. Simultaneously, the quantity of exports witnessed a notable growth of 11%, increasing from 31.98 lakh metric tons to 35.43 lakh metric tons within the same timeframe. Basmati rice found its way to the top markets, with Iran, Iraq, Saudi Arabia, the USA, and the UAE emerging as the top five destinations for these exports. This robust performance underscores the enduring popularity and global demand for Basmati rice, further solidifying its position as a major agricultural product in India's export portfolio.

The negotiations for the proposed India-UK free trade agreement are at an advanced stage, and both sides are working to iron out differences on the remaining issues, a top government official said on Thursday. Commerce Secretary Sunil Barthwal said the negotiations are taking time because 'we want' to safeguard India's interest.

 

'India should commercially gain out of it and we should also be able to safeguard the interest of our farmers, PLI (production linked incentive) scheme goods. So, we are there to see that the deal is a fair deal,' he told reporters here.

 

Additional Secretary in the Commerce Ministry L Satya Srinivas said the talks are at an advanced stage and going on at a 'very' high level to iron out differences.

 

The 14th round of talks started on January 10.

 

The investment treaty is being negotiated as a separate agreement between India and the UK.

 

The bilateral trade between India and the UK increased to USD 20.36 billion in 2022-23 from USD 17.5 billion in 2021-22.

 

On the India-European Union (EU) free trade agreement, the ministry informed that the seventh round of talks is scheduled from February 19-23 here.

 

In June 2022, India and the EU restarted the negotiations for the long-pending trade and investment agreement on Friday after a gap of over eight years.

 

On the India-Pacific Economic Framework for Prosperity (IPEF), Additional Secretary in the ministry Rajesh Agrawal said that legal scrubbing of text on clean and fair economy agreements is underway.

 

He said the supply chain resilience pact will come into force from February 24 this year.

 

To implement this, he said, action plans are being developed to optimise participation in institutional structures under the supply chain pact.

In the State Focus Paper for the financial year 2024-25, the National Bank for Agriculture and Rural Development (NABARD) has suggested the establishment of meat and egg processing units in Gujarat for the preparation of value-added products such as chicken samosa, patties and momos.

 

The focus paper which was formally unveiled at Gandhinagar on Thursday states, 'In order to increase utilisation and demand of meat from other states, establishment of meat processing units may be considered for preparation of value-added products such as chicken samosa, patties and momos which have a high demand in the market as ready to eat products.

 

Suggestions

For the last two years (2021-22 and 2022-23), the total meat production in Gujarat has been stagnating at 0.35 lakh kilograms, states the paper.

 

NABARD also suggested increasing the breeding infrastructure for goat and sheep in the state.

 

Like meat, NABARD also suggested setting up egg processing centres for ready to eat products. It suggested promotion of contract farming to develop the poultry sector at rural level.

 

The egg production in Gujarat marginally fell by 3.6 per cent in 2022-23. The State produced 18,789 lakh eggs during 2022-23. The state has 12.84 lakh desi fowl from backyard poultry and 55.67 lakh improved fowl from commercial poultry farms.

 

The State Focus Paper has projected a 18 per cent growth in the credit potential for the priority sector in Gujarat for the year 2024-25. 'The credit potential for the priority sector in Gujarat for the year 2024-25 at Rs.3.52 lakh crore, a growth of 18.29 per cent over the previous year,” states the paper. Of the total credit potential for Gujarat, Rs.1.8 lakh crore is for MSMEs, Rs.1.42 lakh crore for Agriculture and allied sectors and the remaining for other priority sectors.

Describing India as its biggest partner in South Asia, the Biden administration has said it is working with New Delhi to deploy a multi-billion-dollar climate infrastructure and a new fund that will include a USD 500 million investment contribution from its development finance institution. Afreen Akhter, Deputy Assistant Secretary in the Bureau of South and Central Asian Affairs (SCA), told this at a news conference organised by the Washington Foreign Press Center.

 

'With India, which of course is our biggest partner in South Asia, we launched in January of last year the US-India Initiative on Critical and Emerging Technology. We call this iCET,' Akhter said.

 

The goal is to build a resilient semiconductor supply chain, elevate space cooperation, and partner on the next generation of telecommunications - so, again, a really ambitious initiative to build cooperation on critical and emerging technologies with India, she said on Wednesday.

 

The US is also advancing regional resilience to transnational threats.

 

'We want to talk about it in terms of our work on infrastructure or - and climate change and responding to pandemics. So under the Partnership for Global Infrastructure and Investment, which is another initiative we announced recently, we're working with India to deploy multi-billion-dollar climate infrastructure and a new fund that will include a USD 500 million investment contribution from our Development Finance Corporation,' she said.

 

'This will also include 40,000 public e-buses through an innovative payment secured - security mechanism financed by the Government of India, the United States, and our partners of philanthropy,' Akhter said.

 

'And then finally, we also launched the Climate Action Champions Work in South Asia, which is intended to invest in the next generation of climate leaders to support climate advocacy and respond to their needs throughout the region. So as you can see, we're deeply engaged with all of our partners across the Indo-Pacific and East Asia and South Asia,' she said.

 

Akhter said the US and India have deepened a very broad and multifaceted defence partnership through joint exercises, strengthened defence industrial cooperation, and the annual 2+2 Ministerial Dialogue.

 

'We are really focused on building out that defence relationship. It's one of the key features of our Indo-Pacific strategy,' she said.

 

The US is making huge investments throughout South Asia, she said.

 

'So last fall, the United States and India's Adani Group announced a half-billion-dollar investment in the Port of Colombo in Sri Lanka. This investment is intended to expand the capacity of the port, which is already operating at like 90 per cent capacity and really enable Sri Lanka to become an even bigger economic player in the region as it sits in this prime shipping route,' Akhter said.

 

'To bolster regional security, we're always engaging with our South Asian partners and really looking to build out those security relationships in the region. And we're doing that through a variety of ways, but one way we're doing it is, of course, providing our partners with new capabilities,' she said.

 

In the Maldives, the US recently announced the delivery of four new patrol boats to help them monitor their Exclusive Economic Zones. It has provided three Coast Guard cutters to Sri Lanka, she said.

The 6th round of India -Peru negotiations for a Trade Agreement was held from February 12 to 14, 2024, in Lima, Peru, to continue the work that started in 2017 when the negotiation process was formally announced.

 

The round started with an opening ceremony with the participation of the Vice Minister of Foreign Trade of Peru, Ms. Teresa Mera; the Ambassador of India in Peru, Mr. Vishvas Sapkal; the Chief Negotiator of India, Mr. Vipul Bansal; the Chief Negotiator of Peru, Mr. Gerardo Meza; and the delegations of both countries.

 

During the ceremony, the Vice Minister of Foreign Trade of Peru and the Chief Negotiator of India gave brief introductory remarks reaffirming their commitment to continue working with efficiency, as India and Peru did before the pandemic with five successful rounds until August 2019. The negotiations resumed with the Special Virtual Round in October, 2023.

 

In this sense, both speakers emphasized the importance of taking forward the negotiation process with pragmatism, in order to find creative solutions and to reach consensus that allows to achieve this common objective in the short term. The Trade Agreement will create more trade opportunities for their citizens and enterprises, and also strengthen their economic and commercial ties.

 

In this round, nine working groups held in-person meetings: Trade in Goods, Rules of Origin, Trade in Services, Movement of Natural Persons, Customs Procedures and Trade Facilitation, Dispute Settlement, Initial Provisions and General Definitions, Final Provisions and Legal and Institutional Issues.

 

These meetings involved the participation of more than 70 delegates from both countries together, including their respective negotiating teams. From the Peruvian side, the delegation was led by the Ministry of Foreign Trade and Tourism, with the participation of government officials from other entities such as the Ministry of Economy and Finance, the Ministry of Foreign Affairs, the Ministry of Agriculture, the Ministry of Production, Customs Administration, among others. From the Indian side, the delegation comprised government officials and legal representatives from the Department of Commerce, Department of Revenue and the Directorate General of Foreign Trade.

 

Additionally, during this week and the following, other working groups such as, Technical Barriers to Trade, Sanitary and Phytosanitary Measures, Trade Remedies and Cooperation will continue to hold virtual meetings. The next round is expected to be held in April 2024. The date will be set in the following days.

 

In the last two decades, the trade between India and Peru has increased significantly, from US$ 66 million in 2003 to around US$ 3.68 billion in 2023.

The Commerce and Industry Ministry is weighing the merits of expanding the codes of classification (HSN codes) for rice so that the varieties of non-basmati rice that are not traditionally consumed in the country can be separated from the popular staple variety of non-basmati white rice and excluded from export curbs when restrictions are being contemplated on the latter.

 

The interests of all stakeholders, including farmers, however have to be kept in mind while deliberating the matter, so a decision would be taken by the government only after extensive consultations, said Rajesh Agarwal, Additional Secretary, Commerce Department. The government has temporarily banned all categories of non-basmati white rice for exports.

 

At present, there are just six HSN codes for non-basmati rice while there are 30-40 varieties of such rice grown in the country. 'There is a demand from the industry for new HSN codes for other varieties of rice... When we ban non-basmati white rice, all varieties get banned, whether it is sona masuri, govind bhog and kala namak or the normal non-basmati white rice which is our core concern. The question is how do we differentiate. That is a debate that we are having internally. We are trying to see if there is merit in doing so,' Agarwal said at a media interaction.

 

Interests of all stakeholders need to be balanced while considering the matter, the additional secretary said, 'As a country, on one hand we will not like to impose ban on rice varieties which we are not much worried about (in terms of domestic shortages). At the same time we would need to see there is enough incentive for farmers to keep on producing the normal variety of rice, which is the core staple diet  of the country. We need to balance this. That is a decision that the Department of Commerce will take after detailed stakeholder consultation,' Agarwal added.

 

Agricultural and Processed Food Products Export Development Authority (APEDA) is working on separate HSN codes for GI (Geographical Indications) rice varieties like red rice, black rice and kalanamak rice, per a presentation by APEDA chairperson Abhishek Dev.

 

The country’s agriculture exports may decline by 9 per cent this year primarily due to restrictions on exports of rice, sugar, and wheat, according to APEDA.

 

The Red Sea crisis may have some impact on India’s basmati exports this year to the EU and Egypt but the country’s primary exports to West Asia will not be hampered, another official said.

Basmati rice exports have shown a 19 per cent growth in dollar terms at $3.97 billion in the first three quarters of the current financial year on demand from countries such as Saudi Arabia and Iraq. In the same period last year, basmati exports were $3.33 billion, as per the latest provisional data released by the Agricultural and Processed Foods Exports Development Authority (APEDA).

 

In volume terms, basmati exports were up 11 per cent at 3.54 million tonnes (mt) during April-December 2023 over 3.19 mt in the year-ago period.

 

Shipments of non-basmati rice, which are currently restricted, fell by 28 per cent in value to $3.34 billion over $4.66 billion a year ago. In volume terms, non-basmati shipments were down to 8.34 mt against 13.17 mt a year ago. Overall, cereal shipments were down by a quarter at $7.80 billion compared with $10.37 billion as the government restricted shipments of non-basmati rice and wheat to ensure higher domestic supplies and control price rise.

 

Overall shipments down

The overall exports of agri and processed products monitored by APEDA were down 9.14 per cent at $17.88 billion against $19.68 billion a year ago.

 

Except cereals and cashew, all other categories such as fresh and processed fruits and vegetables, livestock products and seeds witnessed a growth during the period.

 

Among livestock products, buffalo meat shipments saw an increase of 15.61 per cent at $2.78 billion, while poultry products registered a growth of 36 per cent at $130 million. However, dairy products saw a decline of around 31 per cent at $327 million from corresponding last year’s $471 million.

 

Pulses exports were up 4 per cent at $454 million ($436 million in same period last year), while processed vegetables registered a growth of around 24 per cent at $454 m($366 m). The processed fruits and juice shipments were up around 4 per cent at $696 m ($670 m).

 

Groundnut exports were up 7.6 per cent at $606 m ($563 m), while guargum shipments registered a steep decline of 20 per cent at $394 m ($496 m). Cashew shipments were flat at $249 m.

Union Minister of Consumer Affairs, Food and Public Distribution, Textiles and Commerce & Industry, Shri Piyush Goyal has expressed happiness at the rise in the production and quality of Agriculture products to make India self-sufficient and for also enabling export of over $50 billion of agri-related products. Shri Goyal said this during his address at NAFED: Pulse 2024 Convention organized by Global Pulse Confederation in co-operation with co-operative major National Agricultural Cooperative Marketing Federation of India (NAFED).

 

Shri Goyal thanked the farmers of India for their contribution towards making India self-sufficient and making the country a large producer of food grains, pulses, lentils, vegetables, fruits. He said that this has led to expansion both in production and quality of different food products to make India an exporter of over $50 billion of agri and related products. He said that over the last decade due to the commitment and capabilities of the farmers, pulses production has grown by 60% from 171 lakh tonnes in 2014 to 270 lakh tonnes in 2024.

 

'The partnership between NAFED and GPC will continue to grow to make pulses not only India’s wonder-diet but to make the wonder-diet of the world', said Shri Piyush Goyal.

 

Speaking on Bharat Dal, the Minister said that under the leadership of Prime Minister Shri Narendra Modi the government launched the India pulse to support the farmers of the country and ensure the availability of reasonably-priced pulses for Indian citizens. He said that the government-procured chana dal retailed under the ‘Bharat’ brand has already captured 25% of the market share of lentil gram in four months of its launch. The Union Minister, further elaborated, that the high ratings the Bharat Dal has received from customer reviews on various e-commerce sites demonstrates the farmers’ ability to produce high-quality pulses and with the support of the government can become the affordable food for the common man. Shri Goyal also said that over the last decade government procurement of pulses has increased by 18 times.

 

Shri Goyal noted that in 2015 the government introduced buffer stock to ensure moderate prices and price stability shielding the consumers from the food inflation that hit many countries including the developed world reeling with a 40-year high of inflation. 'India was the bright spot with among the lowest inflation rates and has been able to reign in double digit inflation to 5-5.5% in the last decade', he said.

 

On Minimum Support Price (MSP), Shri Goyal said that MSP today assures a price 50% over the actual cost of production to our farmers, thereby providing an attractive return on investment. The Union Minister also said that the MSP is the highest today with increases as high as 117% in Masoor, 90% in Moong, 75% more in chana dal, 60% more in Toor and Urad over the amount provided a decade back. Shri Goyal further said that NAFED and NCCF are encouraging farmers to diversify into pulses and lentils and are willing to provide assured prices for 5-year contracts for government procurement, a massive step for the Government of India.

 

Shri Goyal also stated that India is the largest producer and 5th largest exporter of millets in the world and the government is also putting similar focus on pulses and lentils as with millets and urged the industry leaders in attendance to provide suggestions and guidance to improve productivity and grow the pulse industry.