Pakistan eyes bigger share in US rice market after Trump's 50 percent tariff on India

Arab News

a day ago

ISLAMABAD: Pakistan is seeking to increase its rice exports to the United States (US) to 100,000 metric tons this financial year, up from 80,000 metric tons last year, after President Donald Trump imposed a 50 percent tariff on regional competitor India, the head of the country's rice exporters association said this week.
Pakistan ranks among top ten rice-producing countries in the world. According to the latest Economic Survey of Pakistan, the country's total rice production stood at 9.72 million metric tons in the outgoing fiscal year that ended in June.
In Pakistan, more than 60 percent of the harvest is surplus and available for export, according to the Rice Exporters Association of Pakistan (REAP). The country exported over 5.544 million metric tons of rice, valued at $3.203 billion, worldwide from July 2024 till May 2025.
India, on the other hand, exported 234,467 metric tons of rice to the US alone in the fiscal year 2023-24, valued at $0.31 billion, according to the Indian commerce ministry. However, Trump last month imposed a 50 percent tariff on India, citing New Delhi's imports of Russian oil and its trade barriers on US, and reduced the tariff on Pakistan from 29 percent to 19 percent.
'This [tariff difference] presents a major opportunity for Pakistan to fill the gap and expand its rice exports to the United States,' Malik Faisal Jahangir, chairman of the Rice Exporters Association of Pakistan (REAP), told Arab News on Wednesday.
'Last year, Pakistan exported 80,000 metric tons of basmati rice to the US and this year, we aim to exceed at least 100,000 metric tons by leveraging this tariff advantage.'
The US Department of Agriculture (USDA) reports that rice imports in the country have consistently risen over the past 30 years, increasing from 7 percent of the domestic market in 1993-94 to more than 25 percent in 2022-23. Over 60 percent of these imports are aromatic varieties from Asia, predominantly jasmine from Thailand and basmati from India and Pakistan.
Pakistani rice is of much better quality than India's and far more compliant with US regulations and standards, according to Jahangir. Islamabad could also enjoy a significant competitive advantage in terms of price.
'The 50 percent tariff on Indian rice will effectively price it out of the US market,' he added.
Pakistan struck the trade deal with the US late last month, with the government in Islamabad saying the agreement would increase investments in the South Asian country. A key China ally, Pakistan has been warming up to Trump after he threatened tariffs and has credited US diplomatic intervention for ending a four-day military standoff with India in May. Islamabad has also nominated Trump for the Nobel Peace Prize.
Pakistan exports basmati rice to more than 110 countries, with the Middle East and Europe remaining its primary markets, according to official data.
Pakistani commerce ministry spokesperson Naveed-ul-Haq Kallu said the government is in contact with REAP to fully capitalize on the opportunity to boost Pakistani rice exports to the US.
'Pakistan's commerce ministry has asked rice exporters to submit their recommendations to help fully capitalize on the opportunity to boost Pakistani rice exports to the United States,' Kallu said, adding that rice exports are incorporated into the ministry's tariff implementation strategy that has been forwarded to the prime minister for approval.
'The government will continue working closely with the association to provide maximum facilitation for exporters as it is keen to leverage the advantage created by the new tariffs.'
Arab News tried reaching out to the Pakistani embassy in Washington and the Trade Development Authority of Pakistan (TDAP) regarding their trade facilitation efforts but did not receive a response by the time of filing of this story.
Pakistani exporters and analysts view the new US tariffs as a major opportunity but warn that stringent quality standards would be a key challenge in meeting the US Food and Drug Administration's (FDA) approval.
'We have very small share of around 4.5 percent of the total US rice imports but have this opportunity to take it forward and gradually doubling it, if tariff issue with India persists,' Abdul Basit, a manager at leading Pakistani rice exporter Guard Rice, told Arab News.
Basit noted that although an opportunity exists, attention needs to be given to ground realities as he stressed the importance of producing basmati rice that met both quality and the FDA's compliance standards.
'We need to assess how much FDA-compliant rice we can source from our farmers as failing to do so could expose us to numerous non-tariff barriers from the US, particularly strict regulations on pesticide levels,' he added.
The Guard Rice official described the US tariffs as a 'great opportunity' to expand their presence in the US market, adding that his company, which initially exported around 3,000 metric tons to the US, is now planning to double that volume.
Sana Taufik, head of research at Arif Habib Limited investment and financial services firm, said Pakistan's ability to capitalize on the advantage depends on production, which was hit by climate change and the recent floods.
'This issue needs to be addressed and Pakistan should invest in research and development to drive better growth,' she said.
Pakistani products should be patented and branded as the country has so far secured few patents and could not claim royalties, unlike India, which established this advantage long ago, according to Taufik.
'These challenges could hinder Pakistan's ability to capitalize on the opportunity created by the high tariff on India,' she said. 'But with better coordination, the country can gradually expand its share of the US market for Pakistani basmati rice.'