The US and Paraguay, in their joint submission at the World Trade Organization (WTO), have raise a question on India’s decision over Rice MSP Hike in 2025. Both the US and Paraguay, in a joint submission, said that India raised their Minimum Support Price for Rice in 2025 despite record harvests, exports, stocks and offloading of stocks for ethanol production.
However, the Indian counterpunch over the questions raised by the nations and said that the MSP scheme of India not only supports small and marginal farmers and fed the poor but also kept global prices in check, ensuring food security for LDCs (Least Developed Countries) and vulnerable countries.
The US and Paraguay ask for Explanation Over Rice MSP Hike
The countries asked India to explain the reason behind increasing the MSP for rice in 2025, while India has been claiming for benefits under the ‘Bali Interim Decision’ (that allows WTO subsidy limits to be breached), given India’s record harvests, exports, and stocks exceeding what is necessary to meet domestic food aid needs.
In their joint submission, the US and Paraguay said that “While the MSP scheme may be part of India’s domestic public food distribution system, the scheme’s effects on exports and disposal of stocks for non-food purposes appear to go far beyond food security.”
Indian Rice Exports Rises Significantly
Since India has lifted its export restrictions on rice, its rice exports have significantly increased and are expected to rise to a record high of 22.5 million tonnes in 2025. Significantly, the rise in Indian rice export has put downward pressure on global rice prices. For example, a Pakistani rice exporter reported prices for non-basmati rice from Pakistan fell approximately $200 per metric ton almost overnight.” India has clearly stated backed by proof that it does not export rice from its procured stocks and that it has been submitting all required information on its overall domestic support notifications.