The UK continues to impose an import duty of £155 per tonne on white rice imported from India, which remains in effect despite the FTA. As a result, India is compelled to export brown rice at lower prices.
India and the United Kingdom recently signed a Free Trade Agreement (FTA), officially called the Comprehensive Trade and Economic Agreement (CTEA), in the presence of both countries’ Prime Ministers and Commerce Ministers. While the agreement is being hailed as a significant opportunity for Indian agriculture, a major concern remains unresolved: the import duty imposed by the UK on Indian rice — one of India’s largest agricultural exports to the country — has not been addressed in the deal.
The UK continues to impose an import duty of £155 per tonne on white rice imported from India, which remains in effect despite the FTA. As a result, India is compelled to export brown rice at lower prices. India exports around 400,000 to 500,000 tonnes of basmati rice to Europe annually, with over 50% of it going to the UK. Of this, 98% is brown rice, as white rice exports are not economically viable due to the steep import duty.
Sources in the rice export industry told Rural Voice that they had hoped the new trade agreement would resolve the issue of basmati exports, but that has not materialized. The European Union and the UK do not import white rice from India, citing concerns about the quality of rice processing in India. However, Indian exporters argue that they possess world-class processing technology and have been demanding the removal of this duty for nearly 30 years. The continued imposition of this duty renders Indian white rice uncompetitive in the UK market.
Most of India’s basmati rice exports to Europe are in the form of brown rice, which fetches between $750 and $800 per tonne. In contrast, white rice could fetch over $1,000 per tonne if allowed to be exported. British rice mills import brown rice, process it, sell it under their own brands, and earn substantial profits. Indian companies, however, are unable to sell rice under their own brands. Moreover, since brown rice contains bran, British mills also benefit from extracting rice bran oil and meal.
In early July, Vijay Setia, former president of the All India Rice Exporters Association, wrote to the Prime Minister and the Finance Minister, urging them to address this issue. According to information received by Rural Voice, the Department of Economic Affairs in the Ministry of Finance referred the matter to the Ministry of Agriculture, which then forwarded it to the Ministry of Consumer Affairs, Food and Public Distribution — the nodal ministry for decisions related to the export of essential commodities.
The industry argues that brown rice is considered a health food. Even if India continues to export brown rice, the government should restrict it to 1 kg or 5 kg consumer packs rather than bulk exports. This would help fetch better prices — profits currently being pocketed by UK rice mills.
Following the signing of the India-UK FTA, it was claimed that 99% of Indian agricultural products would now have duty-free access to the UK market. However, there is little mention of the fact that basmati rice — one of India’s largest agricultural exports — remains excluded from this benefit. The issue of duty on basmati rice remains unresolved under the FTA, representing a missed opportunity for Indian farmers and exporters.
India and the United Kingdom recently signed a Free Trade Agreement (FTA), officially called the Comprehensive Trade and Economic Agreement (CTEA), in the presence of both countries’ Prime Ministers and Commerce Ministers. While the agreement is being hailed as a significant opportunity for Indian agriculture, a major concern remains unresolved: the import duty imposed by the UK on Indian rice — one of India’s largest agricultural exports to the country — has not been addressed in the deal.
The UK continues to impose an import duty of £155 per tonne on white rice imported from India, which remains in effect despite the FTA. As a result, India is compelled to export brown rice at lower prices. India exports around 400,000 to 500,000 tonnes of basmati rice to Europe annually, with over 50% of it going to the UK. Of this, 98% is brown rice, as white rice exports are not economically viable due to the steep import duty.
Sources in the rice export industry told Rural Voice that they had hoped the new trade agreement would resolve the issue of basmati exports, but that has not materialized. The European Union and the UK do not import white rice from India, citing concerns about the quality of rice processing in India. However, Indian exporters argue that they possess world-class processing technology and have been demanding the removal of this duty for nearly 30 years. The continued imposition of this duty renders Indian white rice uncompetitive in the UK market.
Most of India’s basmati rice exports to Europe are in the form of brown rice, which fetches between $750 and $800 per tonne. In contrast, white rice could fetch over $1,000 per tonne if allowed to be exported. British rice mills import brown rice, process it, sell it under their own brands, and earn substantial profits. Indian companies, however, are unable to sell rice under their own brands. Moreover, since brown rice contains bran, British mills also benefit from extracting rice bran oil and meal.
In early July, Vijay Setia, former president of the All India Rice Exporters Association, wrote to the Prime Minister and the Finance Minister, urging them to address this issue. According to information received by Rural Voice, the Department of Economic Affairs in the Ministry of Finance referred the matter to the Ministry of Agriculture, which then forwarded it to the Ministry of Consumer Affairs, Food and Public Distribution — the nodal ministry for decisions related to the export of essential commodities.
The industry argues that brown rice is considered a health food. Even if India continues to export brown rice, the government should restrict it to 1 kg or 5 kg consumer packs rather than bulk exports. This would help fetch better prices — profits currently being pocketed by UK rice mills.
Following the signing of the India-UK FTA, it was claimed that 99% of Indian agricultural products would now have duty-free access to the UK market. However, there is little mention of the fact that basmati rice — one of India’s largest agricultural exports — remains excluded from this benefit. The issue of duty on basmati rice remains unresolved under the FTA, representing a missed opportunity for Indian farmers and exporters.