The Hindu Business Line : Basmati exporters upset over $200/t cess

The $200 a tonne (Rs 8,000 a tonne) cess on basmati rice exports imposed by the Finance Ministry is likely to affect shipments from the country, which is a major origin of the aromatic long grain rice.

According to the President of All India Rice Exporters Association, Mr Vijay Setia, almost all stakeholders are likely to be affected because of this bolt from the blue.

While lakhs of growers engaged in basmati paddy cultivation in Punjab, Haryana and Uttar Pradesh would find their incomes turning unremunerative, tens of thousands of collateral jobs of service providers (handling, bagging, transportation) would soon disappear.

Loans may turn sticky

Commercial banks that have financed rice related operations run the risk of their loans turning sticky, while exporters are sure to face arbitration proceedings for contract default. They may be forced to pay huge compensation to overseas buyers because in almost all cases it is customary for the contract to specify that export duties would be on sellers account and import duty on the buyers.

India’s export control is expected to immediately help neighbouring Pakistan to make deeper inroads and capture market share. The rice exporters association is seeking to bring these and related facts to the notice of various Government officials.

Related Stories:
$200 a tonne export duty on basmati

More Stories on : Rice | Exports & Imports | Taxation

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page