India’s Basmati rice exports are likely to decline due to the ongoing conflict between Iran and Israel, adversely affecting the industry’s stability. India is the world’s largest exporter of Basmati rice, of which Panjab accounts for 40%. Approximately 25% of India’s Basmati rice exports are directed to Iran. Iran has imposed a two-month import ban from 21 Oct to 21 Dec to support its local crop, disrupting this significant export channel. Additionally, insurance companies have ceased providing coverage for exports to Iran, causing Basmati rice prices to drop by $9.64 per quintal as exporters and millers reduce their purchases, resulting in substantial losses for Panjab farmers. In the fiscal year 2023-24, India exported 5.2M MT Basmati rice valued at $5.84M, with Panjab contributing significantly. The decline in prices from $42.17 per quintal last year to $32.53 this year has left farmers deeply concerned. Ranjit Singh Jossan, Vice President of the Panjab Rice Millers and Exporters Association, highlighted that the import ban and lack of insurance have halted exports to Iran, urging the govt. to intervene. Moreover, the Iran-Israel conflict has led to increased sea freight costs due to threats from Houthi rebels in Yemen, affecting major importers like Saudi Arabia. With Basmati cultivation expanding in Uttar Pradesh, Rajasthan, and Madhya Pradesh, the anticipated 15% surplus crop this year has created an atmosphere of uncertainty among exporters, threatening the livelihoods of Panjab’s farmers (SDW Vol 2 Issue 33, Story 6).
Like what you're reading? Subscribe to our top stories.
Liv Forum provides a digest of analysis on major issues facing Indian (East) Panjab and Sikhs globally.
In accordance with our Privacy Policy, we will never share or sell the information of our subscribers.
