India may extend export tax on parboiled rice to ease food inflation ahead of national elections. The government is considering keeping the tax at 20%. No immediate proposal to ban exports. Extension of the tax could keep world supply tight and raise prices. Measures to control food inflation include curbing exports, cracking down on hoarding, and providing subsidized rice to retail customers.
India, the world’s top rice shipper, may extend an export tax on the parboiled variety as part of efforts to ease food inflation ahead of national elections, a move that could keep world supply tight and send prices to new peaks.
The government of Prime Minister Narendra Modi, who will seek a third term in the polls due in the first half of this year, is considering keeping the export levy at 20%, according to people familiar with the matter. There is no immediate proposal to ban exports of parboiled rice, said the people, who asked not to be identified as the talks are confidential. The tax is currently due to expire March 31.
Any such move could add to the rally in benchmark Asian rice prices, which are hovering near a 15-year high after India began restricting sales of key varieties in 2023. That would be bad news for some countries in West Africa and the Middle East that rely on the South Asian nation for most of their requirements of the food staple.
A spokesperson representing both the food and commerce ministries didn’t immediately comment.
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