Latest US tariff has worried Indian Basmati rice exporters in India mainly from Punjab and Haryana. 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. India after the newly announced 25 percent additional tariff has joined Brazil at the top of the list of the countries facing the highest import taxes. As per the data released by Agricultural and Processed Food Products Export Development Authority (APEDA), India in the financial year 2024–25shipped around 60.65 lakh metric tonnes (LMT) of Basmati worth Rs 50,312 crore (USD 5,944.49 million) to global markets, with the US accounting for nearly 6 per cent of these exports, worth Rs 2,849 crore. The US is among the highest-value markets for Indian basmati.
Loss of American market need not to be taken as a Disaster
Though America has imposed 50% tariff on Indian goods experts say that “loss of American market needs to be taken as a 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 accounts for a modest share of India’s total aromatic rice trade.
After the US Tariff Indian Basmati exporters are now set to redirect the export of Indian Basmati Rice 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. After the India and the UK FTA UK is also poised to consume a good amount of Indian Basmati rice along with Europe, however, to export Indian Basmati rice to the UK and Europe India needs to maintain stricter quality standards. Apart from the export sector, consumption of basmati rice is also increasing in the domestic Indian market during weddings, festivals, and for luxurious occasions.