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G. Srinivasan

Indian exporters fear their variety image may be bruised

New Delhi , June 2

The recent notification of the Department of Commerce amending the Export of Basmati Rice (Quality Control and Inspection) Rules 2003 to permit export of `Super Basmati' from India as an evolved (hybrid) variety has evoked adverse reaction in Pakistan and also from other superior basmati rice varieties exported by Indian merchants since super is a basmati rice variety developed and nurtured in Pakistan.

Reports from Islamabad in the wake of India's notification suggest that the Pakistani basmati rice commands a premium in global market due to its unique aroma, long and slim grains and elongation after cooking. There is a fear that Indian exporters could label and market this variety in the overseas market.

"Pakistan which had a monopoly over super basmati would lose its edge as the latest Indian notification would take away 40 per cent of our market share in the traditional West Asian markets from the coming season by the variety at prices lower than offered by Pakistan," the reports said.

Even as the Department of Commerce has notified this evolved variety for export, the Union Agriculture Ministry has not recognised it for sale in the local market as basmati under the Seeds Act 1966.

In fact, when the Punjab Government sought notification under Section 5 of the Seeds Act 1966 for super basmati, the matter was discussed in September 2004 and subsequently in January 2005 and more recently in Thiruvananthapuram on January 27-28 with all the stakeholders.

Bio-piracy threat

Then the Committee rejected the proposal for notifying super basmati as it is also "highly susceptible to pest and disease" and of doubtful parentage.

That is why the super does not figure in the list of Indian basmati rice as the parent of super variety - Basmati 320 is not notified under the Seeds Act 1966 and also IRRI collections of Gene Bank. Besides, as super is a variety developed and commercially nurtured by Pakistan, there is a possibility of getting caught under bio-piracy.

Resentment

It is felt that by notifying the super basmati, the definition of basmati might embrace newly developed strains by Indian scientists, paving the way for more such varieties to get exported such as Pusa 1121 and Pusa Sugandh 2 & 3.

While the Rice Exporters' Association of Pakistan sought as early as 2000 to promulgate the GI Act or ordinance sensing that its variety might be hijacked by others, there is also some resentment building up among basmati rice exporters within India on the plausible plea that if there is a backing to the super basmati rice from India, it is tantamount to a tacit acceptance of Pakistani super basmati rice as superior variety, thereby endangering the export of traditional varieties of basmati.

They apprehend that the notification of super basmati runs the risk of only bolstering Pakistan's super basmati variety besides bruising the image of Indian varieties.

As the f.o.b. cost (expressed in dollar) of Pakistani super basmati rice has differential of 35 per cent due to exchange rate differences, Indian grown super rice variety would be higher by 35 per cent, pricing it out of the overseas market.

Demand to fall

For unscrupulous operators, the notification by the Indian Government might give them a handle to pack Pakistani basmati rice in origin label of India and pocket the commercial gain of exchange rate differential.

Basmati rice exporters told Business Line that the demand of Indian basmati rice would plummet on account of shift in procurement by importers from India to Pakistan. The competitiveness of Pakistani basmati rice will get heightened due to the weaker Pakistani rupee, taxation structure and procurement system there.

Once India concedes super basmati rice officially, there would be difficulty for it to show the superior quality of Indian basmati over Pakistani super basmati rice. This would be compounded by the fact that Pakistan has got socio-cultural affinity with importing countries in the West Asian market.

It is also apprehended that the casualty of this new notification could be the joint registration of basmati rice by India and Pakistan as a Geographical Indication (GI) with Islamabad delegation scheduled to visit India in the first week of July 2006, cancelling its visit to protest against India's recent notification.

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