After a challenging year marked by export bans and restrictions, the Indian government is offering a glimmer of hope to non-basmati rice exporters. The good news comes in the form of new Harmonised System (HSN codes) being considered for specific rice varieties, particularly those with Geographical Indication (GI) tags.
What are HSN codes and why are they important?
HSN codes are internationally recognized numerical classifications assigned to traded products. Having distinct codes for GI-tagged rice varieties such as Gobindobhog (West Bengal), Kala Namak (Uttar Pradesh), Jeeraphool (Chhattisgarh) and Johra (Assam) would allow their export even during restrictions on regular white non-basmati rice. This means these unique and valuable varieties can reach new markets and generate income for farmers, even when domestic rice needs take priority. At present, there are six HSN codes for non-basmati rice and one for basmati rice. There are 28 varieties of rice with GI certification and they are from Kerala, Maharashtra, Odisha, Bihar, Madhya Pradesh, and Himachal Pradesh.
Current Scenario of Non-Basmati Rice & How will this work?
Govt had put a ban on the export of white non-basmati rice to keep prices in the retail market in check. In the wake of the imposition of restriction on rice exports, total shipment in the current fiscal is likely to fall by 50-60 lakh tonnes from 220 lakh tonnes in 2022-23, which was a record. But Meanwhile, non-basmati rice shipments declined sharply by 28% to $3.34 billion this fiscal compared to the previous year.
This is due to all non-basmati rice falls under a single HSN code, leading to blanket restrictions impacting all varieties, even those not consumed domestically. New, specific codes for GI varieties will differentiate them from regular non-basmati rice, ensuring their export remains unaffected by broader bans.
Meanwhile New initiatives & Emerging opportunities:
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- The Agricultural and Processed Food Products Export Development Authority (APEDA) is actively supporting this initiative and has facilitated exports of millet-based products by startups.
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- APEDA is planning to run Trial shipments of mangoes and pomegranates to new markets like the USA and EU via sea routes indicating further efforts to diversify export opportunities.
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- According to the Directorate General of Commercial Intelligence and Statistics (DGCIS), basmati rice exports grew by 19% in April-December of FY24 to $3.97 billion.
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- The exports of fresh fruits and vegetables have risen by 21% in the first nine months of FY24 to $1.36 billion on year.
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- The exports of products under the APEDA basket grew by 9% to $26.3 billion in 2022-23 compared to FY22, due to a spike in shipment of rice, fruits and vegetables, livestock and dairy products.
- Non-basmati rice shipment declined sharply by 28% to $3.34 billion this fiscal compared to previous year.
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APEDA Chairman Abhishek Dev mentioned the significant growth in agricultural exports, from USD 0.6 billion in 1987-88 to USD 26.7 billion in 2022-23, expanding to over 200 countries. India now exports fresh fruits to 111 countries.
Positive impact on various stakeholders:
- Exporters: Access to new markets and potential for increased income.
- Farmers: Incentive to continue producing GI varieties with export potential.
- Consumers: Opportunity to discover unique rice varieties from different regions.
While the full impact remains to be seen, this initiative signals a positive step towards supporting non-basmati rice exporters and showcasing the diversity and quality of Indian rice to the world.
So, will this help non-basmati rice exporters? The answer seems promising. With dedicated HS codes and government support, GI-tagged rice varieties have the potential to thrive in the export market, offering exciting opportunities for all involved.