Why is it in the News?

The government will launch retail sales of Bharat Rice at ?29 per kg from next week to provide relief to consumers. It has also directed traders to disclose rice stock to control prices.

Context:

• The recent announcement by the Union government regarding the retail sale of rice at Rs 29 per kg through three cooperatives has garnered attention in the news.
• This initiative, known as 'Bharat Rice,' seeks to address the upward trend in rice prices.
• Over the past year, retail prices have surged by 14.5%, while wholesale prices have seen a 15.5% increase.
• This move aims to mitigate the impact of rising rice prices on consumers and ensure the affordability and accessibility of this staple food item.

Recent Developments:

• In response to escalating domestic rice prices and to ensure food security within the country, the Union government implemented measures in 2023.
  • These included a ban on the export of white (non-basmati) rice and the imposition of a 20% export duty on par-boiled rice.
• The decision to restrict rice exports was driven by the need to stabilize domestic prices and guarantee an ample food supply for the nation.
  • Experts predict that these restrictions are likely to remain in place until the upcoming general election scheduled for April-May 2024.
• Challenges in rice production during the 2023-24 kharif season, exacerbated by dry weather conditions attributed to El Nino, have further complicated the supply situation.
• Despite these trade limitations, local rice prices have remained firm, prompting government warnings to retailers.

Government Intervention:

• Union Food Secretary Sanjeev Chopra highlighted a 14.51% increase in retail rice prices over the past year.
• In response to rising rice prices, the government has mandated traders, wholesalers, retailers, and processors to report their rice and paddy stocks every Friday to manage food inflation and curb speculative activities.
• To counter inflationary pressures, the government has initiated the retail sale of 'Bharat Rice' to the general populace.
• Initially, 5 lakh tonnes of rice will be allocated for retail sale under this brand through agencies like NAFED, NCCF, and Kendriya Bhandar, priced at ?29 per kilogram in 5 kg and 10 kg bags.
• Furthermore, the Food Corporation of India (FCI) has ample stocks of good-quality rice available for sale to traders and wholesalers under the open market sales scheme at a reserve price of ?29 per kilogram.

Status of India’s Rice Exports:

• India holds the position of the world's largest rice exporter, accounting for 45% of the global rice market share.
• During April-May 2023, overall rice exports witnessed a notable increase of 21.1% compared to the previous fiscal year.
  • Basmati rice exports in May 2023 alone surged by 10.86% compared to May 2022, reflecting a sustained upward trend.
• The export of non-Basmati rice has been steadily rising over the past three years, with Basmati rice exports in 2022-2023 surpassing the previous year's figures.
• Recent data provided by the government indicates a 15% increase in total rice exports (excluding broken rice) by August 17 compared to the corresponding period in the previous year.
• Regional Dynamics: Thailand anticipates a nearly 25% decrease in rice production for the 2023-2024 season, while Myanmar has halted raw rice exports.
• Similarly, rice availability is expected to be limited in Iraq and Iran.
• India annually exports more than 4 million tons of basmati - a premium long-grain variety famed for its aroma - to Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates and the United States, among others.