India allows Nepal to import 95000 ton non basmati white rice on quota basis

India allows Nepal to import 95000 ton non basmati white rice on quota basis
December 26, 2023

The information you've provided outlines the recent developments in the trade of rice between India and Nepal. Here is a summary:

Export Ban and Subsequent Quota:

  • The Indian government imposed a ban on the export of non-basmati rice on July 20, affecting the supply to Nepal.
  • Later, on October 18, the Indian government announced the allocation of 95,000 tonnes of non-basmati white rice to Nepal.

Coordination with Indian Suppliers:

  • The Nepal government has instructed private importers to coordinate with the state-owned National Cooperative Exports of India for the rice import process.

Import Quotas for Private Firms:

  • Nepali private-sector importers are limited to importing up to 5,000 tonnes of rice on a first-come, first-served basis.
  • The Ministry of Industry, Commerce and Supplies aims to prevent cartelization by setting this quota.

Allocation of Rice Imports:

  • Out of the 95,000 tonnes, 30,000 tonnes will be imported by government corporations, while the remaining amount will be imported by private-sector suppliers.

Reasons for Indian Export Ban:

  • India imposed the export ban on non-basmati rice in response to the need to maintain its food reserve amid the threat of El Niño disruptions.

Impact on Nepal:

  • Nepal heavily depends on rice imports from India, and the export ban led to a rise in rice prices in Nepal.
  • Despite having adequate inventory, traders increased prices in response to the ban.

Rice Imports from India to Nepal:

  • In the 2021-22 fiscal year, Nepal imported 1.4 million tonnes of rice from India, the highest on record.
  • After the export ban, rice imports dropped to 812,028 tonnes in 2022-23.

Rice Smuggling Concerns:

  • Reports suggest a surge in rice smuggling from India to Nepal since the export ban.
  • Villagers along the India-Nepal border are reportedly involved in smuggling rice into Nepal.

Other Export Controls by India:

  • India has also imposed controls on sugar, wheat, rice, and onions to manage domestic supplies and prices.

Global Context:

  • India, as the world's largest rice exporter, plays a significant role in global rice markets.
  • The export ban contributes to concerns about rising food prices, exacerbated by other global events like Russia's invasion of Ukraine.