India on Thursday imposed a 20% duty on exports of various grades of rice to calm the local prices. The tax would discourage buyers from making purchases from India and prompt them to shift towards rivals Thailand and Vietnam, which have been struggling to increase shipments and raise prices.
The government has excluded parboiled and basmati rice from the export duty, but white and brown rice will draw the duty, which accounts for more than 60% of India’s export. With this duty, Indian rice shipments will become uncompetitive in the world market and it will help to calm the local prices.