Latest news with #IndianBasmati
Express Tribune
3 days ago
- Business
- Express Tribune
Rethinking our industrial strategy
A deeper US-India trade conflict may provoke New Delhi to align more closely with China or the BRICS bloc. This could recalibrate regional trade corridors and further isolate Pakistan unless it plays a smarter diplomatic hand. photo: afp The re-emergence of Donald Trump's protectionist trade agenda has once again stirred global markets – this time with a thunderclap. In a sweeping move, the US president, now campaigning with a vengeance, has imposed a 50% tariff on key Indian exports, ranging from textiles and auto components to pharmaceuticals and food products. The justification? India's expanding trade with Russia and what the Trump camp calls "unfair manipulation of trade advantages." The move has triggered tremors across the markets. While the impact on India is direct and quantifiable, analysts project a drop of up to 60% in US-bound exports and a potential 0.9-percentage-point hit to GDP, the ripple effects across the region are far more nuanced. For Pakistan, the development poses a curious paradox: a potential strategic opening buried under layers of inertia. Let's be clear, Pakistan is not in the position to replace India as a trade partner to the US. Not now, and not anytime soon. Our export volume is modest, our policy environment is inconsistent, and our manufacturing capacity, especially in value-added goods, remains underutilised. But moments like these are not about replacing giants, they are about filling gaps, capturing niches, and sending a message: Pakistan is back in the conversation. Consider this – when Trump imposed a 25% tariff on Indian Basmati in 2019, Pakistani exporters saw a marginal but measurable bump in US orders. With a 50% tariff now in place, the price competitiveness of Indian products will be severely blunted. This opens up a window for Pakistani garments, leather products, rice, surgical instruments, and even sports goods to penetrate markets that may now be reconsidering their sourcing relationships. But opportunity doesn't convert itself. The real question is: will Pakistan move? To do so, it must first look inward. The high cost of doing business, erratic energy supply, delays in refunds, and bureaucratic hurdles continue to choke export potential. While regional rivals like Bangladesh and Vietnam have secured preferential tariffs and scaled up logistics efficiency, Pakistan remains caught in an outdated trade playbook. We must do something about it and must do it quickly. Second, there is an urgent need for high-level trade diplomacy. Pakistan should be knocking on Washington's door, not with aid requests, but with market access propositions. We must push for a revival of GSP privileges or even explore bilateral sector-specific frameworks with the US. The argument is simple: with India's trade relationship strained, Pakistan can offer reliability, capacity, and geopolitical alignment. Third, exporters themselves must upgrade. American buyers are no longer just looking at price; they're looking at environmental compliance, social responsibility, and consistency. It's time our industries adapt, not just for optics but for long-term survival. We need ISO-certified factories, transparent labour practices, and scalable systems. Without these upgrades, it will be difficult to tap this window of opportunity. The tariff disruption is not a one-off. It's a signal of deeper changes in global trade flows, away from overconcentration in India and China, and towards diversification. If Pakistan positions itself wisely, it could ride this shift, not just to gain orders, but to fundamentally rewire its export map. And yet, there are risks. A deeper US-India trade conflict may provoke New Delhi to align more closely with China or the BRICS bloc. This could recalibrate regional trade corridors and further isolate Pakistan unless it plays a smarter diplomatic hand. Moreover, if Pakistan remains slow, the vacuum will be filled by faster-moving nations with better logistics and friendlier trade regimes. So, what should Pakistan do? 1-Launch a "Trade Opportunity 2025" strategy focusing on US-oriented exports. 2-Hold emergency consultations with textile, leather, and rice exporters to assess readiness. 3-Mobilise embassies and trade missions in Washington, New York, and Houston to open commercial dialogues with key US buyers. 4-Fix the fundamentals – power, logistics, taxation, and customs. 5-Create a short-term export incentive package specifically for US-bound sectors. This is not about beating India. It's about being present when the world is reshuffling its sourcing decks. Every trade cycle has moments of disruption that reward the agile. Pakistan, for once, has the chance to be in the right place at the right time – if only it has the foresight to act. Trump's tariffs may be India's headache, but they could be Pakistan's overdue wake-up call. The only question is: are we alert enough to hear it? THE WRITER IS A SENIOR BANKER AND TEACHES ECONOMICS
Indian Express
13-08-2025
- Business
- Indian Express
‘Sweet aroma of new opportunities': Basmati exporters eye Middle East, other markets amid US tariff challenge
With most of the over 60 lakh metric tonnes of Basmati exported from India coming from Punjab and Haryana, exporters are worried about the challenges posed by the latest US tariffs and how it would impact the industry. After the newly announced 25 per cent additional tariff, India has now joined Brazil at the top of the list of countries facing the highest import taxes under President Donald Trump's tariff regime. But what if the US tariffs make Indian Basmati uncompetitive? Can other markets absorb this quantity, and where is the demand strongest? According to APEDA, Punjab and Haryana produce around 80 per cent of the country's Basmati, with the former ranking number one. The Basmati grown here also comes under the GI tag, which also leads to high demand abroad. 'Loss of American market need not spell disaster' In the 2024–25 financial year (April–March), India exported around 3.61 LMT of Basmati to the US. Experts said that while recent developments indicate a setback for the country's Basmati exporters after Washington slapped a steep tariff on imports, the US actually accounts for a modest share of India's total aromatic rice trade. 'With strong demand elsewhere, experts say the loss of the American market need not spell disaster—if exporters move swiftly to tap alternative buyers,' said an exporter. The US-bound Basmati could be redirected to West Asian countries like Saudi Arabia, Iran, Iraq, UAE, Yemen, and Oman. The region is already the largest buyer, purchasing around 70 per cent of the exports, with Saudi Arabia, Iran, and Iraq accounting for around 50 per cent of the Basmati exports in 2024–25. By maintaining stricter quality standards, Europe and the UK can also consume some quantities, given the presence of a strong diaspora there. Demand in the domestic Indian market during weddings, festivals, and for luxury consumption is also increasing. 'No doubt the Middle East, which has both the appetite and cultural preference for Indian Basmati, has a huge demand for it. Saudi Arabia alone imported over 11 LMT in 2024-25, so an additional 3–4 LMT across the Middle East region is feasible. But sudden high tariffs by the US require some preparation, and it may hit Basmati exports a bit in the beginning,' said a source with the APEDA. 'Gradually, however, Indian Basmati will find a new place, and US-bound Basmati could be exported to other countries. In 2023–24, India was exporting Basmati to 150 countries, which increased to 154 countries in 2024–25,' the source said, adding that the surplus Basmati can be absorbed, though prices would likely fall to some extent initially, but not for long. 'Actual impact will be smaller' 'Even if the US market is lost due to high tariffs, it will help in adaptability and in creating new markets,' said a member of the All India Rice Exporters Association (AIREA), adding that since America accounts for only 6 per cent of the total exports, the impact is smaller in scale than people might assume. 'Suddenly losing the US market might be a blow in the current scenario, but India's Basmati story does not end there. For exporters willing to diversify and adapt, the sweet aroma of new opportunities is already waiting for them in various countries,' said another exporter. Director of the Punjab Rice Millers and Exporters Association, Ashok Sethi, said US tariffs on Basmati will certainly hit prices because India exports 3–4 lakh tonnes of Basmati to the nation and for this to be consumed by already existing markets, would mean that prices would slip lower. 'Moreover, the Basmati cultivation season is already over in Punjab, and this year around 6.83 lakh hectares are under the crop. Exporters will have to assess the market before purchasing from farmers,' he said.
New Indian Express
07-08-2025
- Business
- New Indian Express
50% US tariff to hurt Indian basmati, boost Pakistan's share
NEW DELHI: With US President Donald Trump slapping additional 25 per cent ad valorem duty above the 25 per cent reciprocal tariffs that were announced on August 1 taking the total tariff burden to 50 per cent thus now the Indian basmati rice exports will bear the brunt and the gainer will be Pakistan, as the market share of this aromatic, premium rice variety from the neighboring country will increase in United States and share of Indian basmati is likely to decline sharply. This development is likely to severely affect Punjab, the highest producer of basmati rice in the country, accounting for 40 per cent of production, followed by Haryana and other states. While the total market of basmati rice in the United States is of approximately 5 lakh metric tonnes (LMT) of this at present India exports about 3 LMT approximately worth $350 million and rest 1.8 LMT is exported by Pakistan. As presently the average price is $1200 per metric tonne (MT) and with the new tariff another $600 per MT will be added thus it will be $1800 and on the other hand Pakistan, which enjoys low tariff of 19 per cent as the their basmati will cost only $1450 a difference of $ 350 per MT. In the 2023–24 fiscal year, a total of 59.42 lakh metric tonnes (LMT) of basmati rice was exported from the country. Of these exports, basmati rice was mainly sent to five countries: 7 LMT to Iran, 11 LMT to Saudi Arabia, 8 LMT to Iraq, 3 LMT to Yemen, and 3 LMT to the US, with the remainder going to other countries. According to Agricultural and Processed Food Products Export Development Authority (APEDA) under the Union Ministry of Commerce and Industry India's foreign exchange earnings from basmati rice exports were Rs 48,000 crore in 2022, out of which Punjab contributed at least 40 per cent. Speaking to TNIE, Ranjit Singh Jossan, Vice-President of the Basmati Rice Miller and Exporter Association, said, `` The US imported nearly 3 lakh metric tons of Indian Basmati last year, valued at approximately $350 million. The additional 25 per cent tariff imposed by the US on Indian basmati rice exports poses a serious challenge to the industry, effectively increasing the total duty to 50 per cent. This move will significantly reduce India's price competitiveness. Currently, Indian basmati is exported to the US at an average price of $1200 per metric tonne (MT) and with the new tariff another $600 per MT will be added thus it will be $1800, making Indian rice significantly more expensive than that of competing countries, especially Pakistan, which enjoys low tariff of 19 per cent as the their basmati will cost $1450. Thus the demand for Indian rice in the US will almost disappear, putting our centuries-old market at risk of vanishing.'' Jossan added that the consequences are manifold, `` First, India could lose substantial market share to Pakistan and other exporters of aromatic or specialty rice varieties. Second, the US, which historically accounts for 8 to 10 per cent of India's basmati exports, will witness a sharp decline in imports.
Time of India
16-06-2025
- Business
- Time of India
Iran-Israel conflict impact: Basmati rice prices to drop as exports to Iran, third largest buyer of Indian basmati, expected to decline
During 2024-25, India's basmati rice exports to Iran were valued at ₹6,374 crores. (AI image) Basmati rice prices, which saw an increase of 15-20% in the past two months due to higher exports, are expected to decrease in the upcoming weeks as exports to Iran may decline amidst its ongoing conflict with Israel. According to the Agricultural and Processed Foods Export Development Agency (APEDA), Iran ranks as the third-largest purchaser of Indian basmati rice, following Saudi Arabia and Iraq. During 2024-25, India's basmati rice exports to Iran were valued at ₹6,374 crores, representing 12.6% of India's total basmati exports for that period. Major importing nations from West Asia and Iran had enhanced their purchases after Indian Basmati rice prices had fallen to ₹75-90/kg, leading to an upward price movement. "The export prices have come down from $950-1000/tonne about a month ago to $900-950/tonne," said Rajesh Jain Paharia, an exporter of Basmati rice according to an ET report. Basmati rice "Prices have corrected, as freight is expected to go up due and transshipment issues," said Paharia. "Prices of Indian Basmati rice had reached their bottom by April as the global export demand was less due to multiple factors. However, export demand increased as everyone wanted to stock at low prices, bringing a surge in exports in May and a consequent increase in prices by about 15-20%," said Dhaval Shah, an exporter and domestic trader of Basmati rice in Maharashtra. "Although the prices are likely to remain stable for now, factors like the Trump effect or any escalation of the war will decide the future course of prices. Countries tend to buy more to ensure their food security if they see indications of escalation of war." The Indian Rice Exporters Federation's national president, Prem Garg, expressed concerns regarding current sea shipments and pending payment issues. Trade estimates indicate that outstanding dues for Basmati trade with Iran typically amount to ₹1,000-1,200 crore. "In our trade with Iran, we take 20% advance payment and rest all is on 180 days credit," said Pahariya. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
15-06-2025
- Business
- Economic Times
Basmati prices may soften soon amid Israel-Iran conflict
Basmati rice prices, recently elevated due to increased exports, are anticipated to decrease as exports to Iran are expected to decline amidst geopolitical tensions. While Iran's conflict with Israel impacts demand, outstanding payments and freight concerns add to the uncertainty. The market's future hinges on global events and potential shifts in trade dynamics. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Pune: Prices of Basmati rice, which have increased by about 15-20% over the last two months due to a jump in exports, are likely to reduce in the coming weeks as exports to Iran are expected to decline due to its conflict with prices of Indian Basmati rice dropped to ₹75-90/kg, major importing countries from West Asia and Iran had increased buying, causing prices to move is the third largest buyer of Indian basmati rice after Saudi Arabia and Iraq, according, Agricultural and Processed Foods Export Development Agency ( APEDA ). In the 2024-25, India had exported basmati rice worth ₹6,374 crores to Iran, which accounted for 12.6% share of India's total basmati exports in 2024-25. "The export prices have come down from $950-1000/tonne about a month ago to $900-950/tonne," said Rajesh Jain Paharia, an exporter of Basmati rice."Prices have corrected, as freight is expected to go up due and transshipment issues," said said that the export volumes had declined for a few months since January."Prices of Indian Basmati rice had reached their bottom by April as the global export demand was less due to multiple factors. However, export demand increased as everyone wanted to stock at low prices, bringing a surge in exports in May and a consequent increase in prices by about 15-20%," said Dhaval Shah, an exporter and domestic trader of Basmati rice in Maharashtra. "Although the prices are likely to remain stable for now, factors like the Trump effect or any escalation of the war will decide the future course of prices. Countries tend to buy more to ensure their food security if they see indications of escalation of war."Prem Garg, national president, Indian Rice Exporters Federation, said, "There are concerns about the shipments that are currently on the seas. There are also worries about payment dues."According to trade estimates, usually, the outstanding dues of Basmati trade with Iran stand at ₹1,000-1,200 crore. "In our trade with Iran, we take 20% advance payment and rest all is on 180 days credit," said Pahariya.
