India's basmati rice exports are expected to surge by 33 per cent during the season starting from October following the government's decision to reduce the minimum export price (MEP).
"Basmati rice exports may increase to 2 million tonnes from 1.5 million tonnes in the last season," Former President of All India Rice Exporters Association Vijay Sethia said. According to official data, India's export of basmati rice was Rs 11,162 crore in 2008-09 fiscal.
Welcoming the reduction in MEP, he said this will ensure reasonable price to farmers and competitive environment in international markets.
The government has lowered MEP to USD 800 per tonne from the present level of USD 1,100 per tonne, Food and Agriculture Minister Sharad Pawar said last week.
However, the Commerce Ministry is yet to notify the cut in MEP
Trade sources said India can import 3-4 tonnes of non-basmati rice and about 6-7 tonnes of wheat by exporting one tonne of basmati rice at the current price level.
The average price of basmati rice contracted by Indian exporters last year was about USD 1,200 per tonne. Whereas the current global price of wheat is about USD 180 per tonne, while rice in Myanmar is available at about USD 325 per tonne, traders said.
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