India may curb rice exports to fight inflation

India may curb rice exports to fight inflation

Recently, India’s export restrictions on wheat and sugar have hit global markets, and a food storm is imminent. This signifies that with the escalation of food protectionism, some countries have cut off the external supply and export of their agricultural products.


Analysts say rice could be India’s next target of food protectionism.


“It’s only a matter of time before the government considers restrictions on rice exports,” said Radhika Piplani, an economist at India’s Yes Bank. She added that it remains to be seen whether the restrictions will lower domestic food prices and how soon they will bear fruit.


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A stable supply of rice could prevent the international food crisis from getting worse. Wheat and corn prices have soared as the war in Ukraine disrupted supplies to the world’s main granaries, while rice prices have remained low due to ample production and large existing inventories.


But that could change if India decides to restrict rice exports, which could prompt other countries to follow suit. About 90% of the world’s rice is produced and consumed in Asia, with India accounting for 40% of the global rice trade.


“India’s rice supply is sufficient and there is no need to ban or restrict exports,” noted B.V. Krishna Rao, president of the Rice Exporters Association of India. “If the government still wants to impose export restrictions, it may be a political call. In the national interest, exporters The association supports this approach.”


Poornima Varma, an assistant professor at the Indian Institute of Management, said, “Restricting rice exports is a possibility.” She suggested that “the government may feel the need to replace wheat with rice to curb domestic inflation and ensure domestic food security.”


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Prime Minister Narendra Modi’s government is taking coordinated measures to tackle high inflation, seeking to slow price increases and lessen the impact on consumers. Inflation in the country’s retail sector is at an eight-year high. Inflation is a politically sensitive issue that could affect people’s votes in parliamentary elections.Air freight forward:


Suvodeep Rakshit, senior economist at Kotak Institutional Equities in Mumbai, said India’s decision to limit rice exports will depend on the price movement of rice in the coming weeks, which in turn depends on the weather. He pointed out that if the monsoon season causes climate instability and rice prices soar, exports are likely to be curbed.

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