Why India Has Been Questioned at the WTO For Its Rice Export Policy

What’s in today’s article?

• Why in the News?
• About UN World Food Programme
• India’s Rise Exports
• World Food Programme’s Tenders for Rice
• Countries Have Asked India to Explain Reason Behind Ban on Rice Export Ban

Why in the News?

• Recently, Canada, Brazil, Australia, and the UK have asked India to regarding its rice export policy.
• The countries are seeking clarification at the World Trade Organisation (WTO) whether India had stopped its rice exporters from participating in the UN World Food Program (WFP) tenders earlier this year.
  • These tenders were for broken rice supplies to countries including Cameroon, Togo, and Algeria.
• The countries also want to know whether India’s decision was contradictory to its commitment to exempt such supplies from export restrictions.

About UN World Food Programme

• The United Nations World Food Programme (WFP) is the world's largest humanitarian organization focused on hunger and food security.
• Established in 1961, it provides food assistance in emergencies and works with communities to improve nutrition and build resilience.
• The WFP aims to eradicate hunger and malnutrition, helping people in need worldwide.
• It relies on donations from governments, corporations, and individuals to fund its efforts.

India’s Rice Exports

• India is the largest rice exporter globally with a 45% share in the world rice market.
• India imposed a 20% export duty on white rice in September 2022, followed by a similar duty on parboiled rice in August 2023. The measure was taken to control domestic rice prices.
• Domestically, the ban helps control rice prices and highlights the necessity to reduce paddy cultivation due to declining water tables.
• A balanced approach is crucial to protect consumer and farmer interests while conserving water resources.
• Notably, basmati rice, accounting for nearly half of India's exports, remains unaffected by the ban, .minimizing the global impact of the rice export ban.
• Since the export ban, India has supplied rice to needy nations and its key strategic partners, but on a case-by-case basis.

World Food Programme’s Tenders for Rice

• Several African nations are heavily dependent on rice imports from India.
• Togo imported a substantial 88% of its rice from India last year.
• Benin, the largest global importer of Indian broken rice, procured 61%, while almost half of Senegal's imports of the grain originated from India.
• In August 2024, the WFP had sought 200,000 tonnes of rice for its humanitarian operations from India.
• The demand was made citing “catastrophic levels" of global food insecurity triggered by the covid-19 pandemic and the Ukraine war.
• However, in February 2024, the Government barred the domestic rice exporters to participate in United Nations World Food Program tenders.

Countries Have Asked India to Explain Reason Behind Ban on Rice Export Ban

• The UK, at the recent WTO agriculture committee meeting, noted that India’s restrictions on rice exports had resulted in a considerable decline in total exports of rice in 2023-24.
• The countries pointed out that if India had actually stopped participation in WFP exports, it would be in violation of its commitment to exempt such supplies from export restrictions.
• At the WTO’s 12th Ministerial Conference in Geneva in 2022, WTO members had approved a decision to exempt the WFP’s humanitarian food purchases from export restrictions.
• India had initially not been in favour of the decision as it was concerned about retaining the flexibility of imposing export restrictions to ensure its domestic food security, but had finally given its consent.
• India did not come up with immediate answers to clarifications sought by Australia, Canada, Brazil, Switzerland, and the UK, at the recent WTO meeting.

It said that it had taken note of the question and would provide an answer soon.

Q1. Which State in India is the largest producer of Rice?

West Bengal ranks no. 1 with a total rice production of 146.05 lakh tons. It is the highest rice producing state in India with a yield of 2600 kilograms per hectare.

Q2. What is a Paddy Straw?

Paddy straw is produced as a byproduct of rice production at harvest. It is removed with the rice grains during harvest.

Source: India under WTO scrutiny for alleged ban on rice exports to UN tenders | Hindu