Govt imposes Rs 8,000/tonne duty on Basmati export, cuts MEP
The government on Tuesday imposed an export duty of Rs 8,000 per tonne on Basmati rice shipment, which the industry feels will hit the overseas sale.
By PTI |
New Delhi: The government on Tuesday imposed an export duty of Rs 8,000 per tonne on Basmati rice shipment, which the industry feels will hit the overseas sale.
The government also reduced the minimum export price to 1,000 dollars a tonne, from 1,200 dollar a tonne.
Announcing the decision in Lok Sabha, Finance Minister P Chidambaram said: "Margins of exports of Basmati rice have been rising as a result of buoyancy in international markets."
Reacting to the decision, All India Rice Exporters Association Chairman Vijay Sethia said, "the government's step will backfire in the long run. Modernisation of rice processing plant will come to a standstill."
India will lose goodwill in the international market like it happened in case of Darjeeling tea, he added.
Sethia noted that introduction of export duty would lead to conflict between Indian sellers and overseas buyers.
"When the cess has been levied, the exporter will ask the buyers to pay extra for that. The importers, which have contracted at certain price, may not agree to the request," he said.
It looks simple that the cess is equivalent to the reduction in the MEP, which is USD 200 per tonne, but "cess has to be paid by exporter from his pocket", he argued.
Sethia pointed out that the contract price for Basmati rice would be the same, even after reduction in the MEP as many premium varieties command higher rate in international market. Exporters are contracting the shipments at above 1500 dollars per tonne.
The government also reduced the minimum export price to 1,000 dollars a tonne, from 1,200 dollar a tonne.
Announcing the decision in Lok Sabha, Finance Minister P Chidambaram said: "Margins of exports of Basmati rice have been rising as a result of buoyancy in international markets."
Reacting to the decision, All India Rice Exporters Association Chairman Vijay Sethia said, "the government's step will backfire in the long run. Modernisation of rice processing plant will come to a standstill."
India will lose goodwill in the international market like it happened in case of Darjeeling tea, he added.
Sethia noted that introduction of export duty would lead to conflict between Indian sellers and overseas buyers.
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"When the cess has been levied, the exporter will ask the buyers to pay extra for that. The importers, which have contracted at certain price, may not agree to the request," he said.
It looks simple that the cess is equivalent to the reduction in the MEP, which is USD 200 per tonne, but "cess has to be paid by exporter from his pocket", he argued.
Sethia pointed out that the contract price for Basmati rice would be the same, even after reduction in the MEP as many premium varieties command higher rate in international market. Exporters are contracting the shipments at above 1500 dollars per tonne.
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