A team of high level delegates and Commerce Ministry officials will visit Iran by the end of this week to have words on the Basmati Rice export between the two nations as the import export of rice between the two nations had been halted for past few months.
This visit is a significant visit as the Middle East Nations has banned rice import since November 2014 citing excess stock from previous year’s crop and high yield in 2014.
Iran, a major buyer of Indian Basmati Rice had banned rice import which has affected Indian rice market. Of total rice production in India, 40% of the rice goes to Iran as export. Last month it was assured by some Iranian authorities that Iran the biggest market for Indian Long Grain aromatic rice will now open from next fiscal year 2015-16.
The team of delegation who visited Iran will meet Iranian Commerce Secretary and trade ministers according to local sources. The topic of discussion would be seeking approval from Iran to remove the ban and how India can increase export trade with Iran. Apart from rice trade, issues related to the crude oil import will also be discussed. India is the major importer of crude oil from Iran but the import has been declined in March after being pressurizes from western nations.
To facilitate trade between India and Iran, India’s new foreign trade policy has reportedly retained the rupee-riyal payment mechanism.
The bilateral trade (commercial relationships, facilitating trade and investment between the home country and the foreign country by reducing or eliminating tariffs, import quotas, export restraints and other trade barriers.) between Iran and India has increased by 2% from USD15.27 billion in 2013-14 as against USD 14.94 billions in 2012-13.
Indian basmati rice export has increased to about 33% in the year 2013-14 with the export volume of 1.44 million tons. On the other hand the Middle East nation’s import has declined in 2014-15 due to their demand to revise the accepted arsenic level from 150 ppb to 120 ppb in basmati rice. Apart from this in September 2014 Iran has increased import duty from 22% to 44% before banning rice import.
APEDA Sources says that in first ten months of FY 2014-15, India has exported 767,697 tons of basmati rice to Iran. If this speed continues, expert believes that rice export to iran will decline by about 15-20% in 2014-15.