INDIA RAISES RICE EXPORT PRICES
New Delhi, March 7, 2008 (IANS)

India has raised the minimum price for exporting basmati and non-basmati rice to $900 and $650 per tonne respectively, the Commerce and Industry Ministry stated in a note Friday. Earlier, there was no fixed minimum price for export of basmati rice. For non-basmati rice, the minimum price used to be $500 per tonne. Food grain prices had been a cause of concern for India due to increasing demand and global supply shortage.

"The government is doing this unnecessarily. There's a lot of surplus already in Andhra Pradesh, then what was the need to take this step," Prem Garg, managing director, Lal Mahal Group and vice chairman, All India Rice Exporters' Association, told IANS. "In a bid to discourage rice export to control domestic prices the government will spoil our markets and also the credibility of the country would be at stake as there's no guarantee of price stability," Garg said.

The Commerce and Industry Ministry has also restricted the export of basmati and non-basmati rice through the ports of Kandla, Mumbai, Kakinada and Kolkata. However, this restriction would not apply during export under various aid programmes, the press note said.

"The prices of wheat and rice have increased in the world market respectively by 88% and 15%. All these trends are inflationary, and there is pressure on domestic prices, especially on the prices of food articles," Finance Minister P. Chidambaram had said while presenting the country's budget for 2008-09. "Consequently, the management of the supply side of food articles will be the most crucial task in the ensuing year," he had said.

India exports about 4-5 million tonnes of rice annually. Last year on Oct, the government had banned exports of non-basmati rice but eventually allowed following widespread protests from farmers and traders and allowed its export at a floor price of $425 a tonne.