According to one of the reports it has been indicated that the government of India is likely to strike a one million ton rice export deal worth Rs.3,000 crore (around $443 million) with Indonesia shortly. In this regard, the Indian government will reportedly execute the export contract from the government stocks. This deal is a first major shipment from government stocks since 2003-04, when the government exported around 2.775 million tons of rice from the central pool. The government has stopped exporting rice from the central pool since 2005-06.
Further, as per sources, it has also been noted that though the Indonesian government sought for import of around 1.5 to 2 million tons, but the Indian government agreed to export only one million tons. Moreover, the Indian government is understood to sell rice at economic cost or procurement costs and freight. The economic cost of rice of 2015-16 seasons is Rs.32, 580 which is around $481 per ton for common variety and Rs.33, 300 (around $492) per ton for higher grade as revealed by the Food Corporation of India (FCI) sources.
Furthermore, with regard to execution of the deal, the Indonesia’s state logistics agency Bulog and India’s public sector trading company Metals and Minerals Trading Corporation of India (MMTC) will reportedly execute the present contract. Further, it has been noted by the FCI that India’s rice stocks in the central pool as of January 1, 2015 stood at around 26.025 million tons (including a milled equivalent of about 13.34 million tons of paddy) against the required buffer norms of around 7.61 million tons.