Introduction 1 2.Origin and history of Rice in India 2 3.Production of Rice in India 2 4.Classification of Rice 3 5.Branding of rice 5 6.

Factors influencing prices of rice 6 7.Problems of Rice exports fromIndia 7 8.Suggestions for sustaining Riceexports 8 9.Prospects of Rice exports fromIndia 9 10.Incentives to Rice exporters of India 10 11.Restrictions on Exports 11 12.Statistics & Calculations of RiceExports from India 12 13.Case Study 15 14.Conclusion

17 15. Agencies exporting rice 18 Primary data:i.Information on Karari RiceMillsii.Questionnaires 18 17.Bibliography

INTRODUCTION Worldwide, India stands first in rice area and second in rice production, after China. It contributes 21.5 percent of global rice production. Within the country, riceoccupies one-quarter of the total cropped area , contributes about 40 to 43 percent of total food grain production and continues to play a vital role in the national food andlivelihood security system. However, India did not become a major rice exportingcountry for a long time. Its share in world rice trade, mainly in the form of small-volumeexports of highly prized basmati rice, was insignificant (5 percent). It was not until themid-1980s that the quantum of export started to grow, from 110000 tonnes in 1978-79to 890613 tonnes in 1994-95 and to a record 5.5 million tonnes in 1995-96, secondonly to Thailand (at 5.9 million tonnes).Rice is one of the importantcereal food crops of India. Ricecontributes about 43% of total foodgrain production and 46% of total cereal production in the country. It continues to play vital role in the national exports.The percentage share of rice in totalnational export was 4.5% during 2005-06. The percentage share of agricultureexport in total national export was18.25%, whereas the percentage share of rice export in total agriculture exportwas 24.62% during 2005-06. Thus, riceexport contributes nearly 35% of totalagriculture export from the country.

Among the exporting countries, Thailand, Vietnam, India and Pakistan are themajor countries exporting rice in sizeable quantity. India is one of the richest countriesin the world in terms of possessing tremendous diversity in rice varieties . There aredifferent varieties of rice-depending on the weather, soil, structure, characteristics and purposes.Rice is grown under a damp warm climate. A temperature range of 20C to 37.7C (68 F to 100 F) is required for the optimum growth of rice. Rice being a semiaquaticcrop grows best under submerged, waterlogged conditions. Rice is able to tolerate awide range of soil reactions, but has a preference of acidic soils. Rice cultivation

isfound in all the states of India, but West Bengal, Uttar Pradesh, Madhya Pradesh,Punjab, Orissa and Bihar are the major rice producing states. About 600 improvedvarieties of Indica rice have been released for cultivation since 1965. ORIGIN AND HISTORY OF RICE IN INDIA India is an important center of rice cultivation. The rice harvesting area in India isthe world's largest. The two major rice varieties grown worldwide today are Oryzasativa indica and Oryza sativa japonica . According to research studies, they owe their origins to two independent events of domestication thousands of years ago.Historians believe that while the indica variety of rice was first domesticated inthe area covering the foothills of the Eastern Himalayas (i.e. north-eastern India),stretching through Burma, Thailand, Laos, Vietnam and Southern China, the japonicavariety was domesticated from wild rice in southern China which was introduced toIndia before the time of the Greeks.The earliest remains of cultivated rice in the sub-continent have been found in thenorth and west and date from around

2000 BC . Perennial wild rices still grow in Assamand Nepal. It seems to have appeared around 1400 BC in southern India after itsdomestication in the northern plains. It then spread to all the fertile alluvial plainswatered by rivers. Cultivation and cooking methods are thought to have spread to thewest rapidly and by medieval times, southern Europe saw the introduction of rice as ahearty grain. Some says that the word rice is derived from the Tamil word Arisi. Rice is first mentioned in the Yajur Veda (c. 1500-800 BC) and then isfrequently referred to in Sanskrit texts. In India there is a saying that grains of riceshould be like two brothers, close but not stuck together. Rice is often directly associatedwith prosperity and fertility; hence there is the custom of throwing rice at newlyweds. InIndia, rice is always the first food offered to the babies when they start eating solids or tohusband by his new bride, to ensure they will have children. PRODUCTION OF RICE IN INDIA From a nation dependent on food imports to feed its population, India today isself-sufficient in grain production and also has a substantial reserve. The progress made by agriculture in the last four decades has been one of the biggest success stories of liberal India. Agriculture and allied activities constitute the single largest contributor tothe Gross Domestic Product, almost 33% of it. Agriculture is the means of livelihood of about two-thirds of the work force in the country.The demand for rice in India is projected at 128 million tonnes for the year 2012and will require a production level of 3,000 kg/hectare significantly greater than the present average yield of 1,930 kg/hectare. Government of India is targeting to achieve production of 129 million tonnes of rice by 2011-12 with the growth rate of 3.7% alongwith other food grains. The production of rice in India has shown an increasing trendwhich is evident from the Table given below: PRODUCTIONCONSUMPTION YEAR PRODUCTION(in mn tonnes)YEAR RICE (ingrams) 2000-0153.632000220.02001-0274.292001204.92002-0382.542002215.020030486.082003201.82004-0589.682004205.42005-0684.982005206.42007-0893.082006208.1

Source: Federal ministry of Agriculture, Govt. of India CLASSIFICATION OF RICE India is one of the important countries in the world in export of rice. India'sexports are expected to go up further during current financial year. Hence, Indian riceexports are set to reach second place in the world markets after Thailand edging outVietnam in the process as per the report of the Food and Agricultural Organisation.Indian rice is classified into three types: A.BASMATI RICE Rice export from India constitutes the major share of Basmati rice . Nearly two-third of Basmati rice produced in India is exported. Basmati rice is the leading aromaticfine quality rice of the world trade and it fetches good export price in the internationalmarkets. In fact, Basmati rice is a gift from "Mother Nature" to the Indian subcontinentand grows in the Indo-Gangatic plains only. The meaning of Basmati can be derived from "bas" which means aroma and "mati" meaning sense. Thus the word Basmati implies 'ingrained aroma' . So it is thearoma that gives basmati its novel characteristics unmatched by any other rice grainanywhere else in the world. Many scented varieties of rice have been cultivated in theIndian sub- continent from time immemorial but basmati distinguishes itself from allother aromatic rice due to its unique aromatic characteristics coupled with silky textureof its long grain. Now, it is still considered "dream of the masses" and "charm of theclasses".Golden parboiledRaw BasmatiSilky raw basmatirice Gulf region remains the major markets for Indian basmati rice and inside Gulf,Saudi Arabia accounts for the major chunk of basmati imports from India. Pakistan isthe sole competitor for India in the international market for basmati rice. During 2005-06, 2006-07 and 2007-08, total quantities of basmati rice exports from India were 5.98lakh million tonnes, 6.38 lakh million tonnes and 8.52 lakh million tonnes in which the percentage share of Asia was 85.69%, 82.12% and 73.38% respectively.

The export to North America has also increased in the same order from 1.39%during 1998-99 to 5.28% during 2000-01. However the export to other countries remainsconstant with slight fluctuation from year to year. India's major markets for basmati riceexports have been Saudi Arabia, Australia, Austria, Belgium, Bahrain, France,Germany, U.K., Denmark, U.S.A., Canada, Belgium, Kuwait, Italy, Oman, Yemen,Netherlands, Jordan, Indonesia, etc. In fact, Saudi Arabia traditionally has been thelargest market for Indian basmati rice. B. NON-BASMATI RICE Major destinations for India's non-basmati rice exports are Bangladesh,Australia, Bahrain, Ethiopia, Djibouti, France, Germany, U.K., Hong Kong, Korea,Sri-Lanka, Maldives, Mauritius, Malaysia, Nigeria, Ivory coast, Indonesia, Nepal,Oman, Qatar, Russia, South Africa, Saudi Arabia, Somalia, Singapore, U.A.E.Y.A.R., etc. Competing countries in the international markets for India for the exports of non-basmati rice are Thailand, Vietnam, Burma, China, U.S.A. and Pakistan. Major quantity of non-basmati rice is exported to Asia continent.During 2004-05, 2005-06, 2006-07 and 2007-08, a total quantity of 9.59 lakhmillion tonnes, 9.28 lakh million tonnes, 28.75 lakh million tonnes and 7.08 lakh milliontonnes were exported to Asia continent which were 48.20%, 51.66%, 65.86% and56.28% of total export of non-basmati rice from India to Asia, respectively.After Asia, non-basmati rice is exported from India to Africa continent. During2004-05, 2005-06, 2006-07 and 2007-08, a total quantity of non-basmati rice exportsfrom India to Africa were 5.39 lakh million tonnes, 5.59 lakh million tonnes, 10.67 lakhmillion tonnes and 3.24 lakh million tonnes, in which the percentage share of Africacontinent was 27.09%, 31.14%, 24.44% and 25.73% respectively of total export of non- basmati rice from India. Next to Africa continent, Europe continent has been importing non-basmati ricefrom India during 2004-05, 2005-06, 2006-07 and 2007-08. The exports of non-basmatirice from India to other continents are very meager. The exports to Europe continentduring the last few years were an average more than 1.5 lakh million tonnes per year C. PARBOILED RICE Indian is exporting parboiled rice to Middle East and African countries, as thesecountries prefer parboiled rice. BRANDING OF RICE

It's sign of the changing times. The imprint of a brand is getting bolder, even in adown-toearth commodity market like rice. Along with increasing consumer awarenessand changing preferences, the rice industry is witnessing change. No more is the friendlyneighbourhood grocer's word all there is to go by. In a country that produces thousandsof varieties of rice, branding has come to play a role in domestic as well as exportmarkets. The brand is the new mantra for success and basmati, also known as the 'kingof rice', is in the midst of the action. LAL QILLA TOPS THE LIST India accounts for about 70 percent of the world's basmati production of 1.25million metric tonnes. Of this, nearly 3.5 lakh metric tonnes is consumed in India and therest is exported. The industry is growing rapidly the world over with basmati becomingincreasingly popular. Of the total domestic basmati consumption of 3.5 lakh metrictonnes, branded basmati accounts for about 1.25 lakh metric tonnes and has beengrowi ng at the rate of 20 per cent a year. The Indian branded basmati market isestimated to be worth between Rs. 600-700 crore. Rice producers have picked up themarket trend towards preference for branded basmati and have jumped on to the bandwag on so that there are more than 100 regional brands of rice in India. The trendsetter has been Amar Singh Chawalwala of Amritsar , whose Lal Quila brand isacknowledged as the best selling rice brand in India, notching up sales of Rs 100 crore ayear. BASMATI RICE BRANDS OF INDIA In a tough and a competitive international market of rice, it has become very muchnecessary to give a brand name to even a food grain, rice. With the increase in consumer awareness and shift in the position of customer from a mere buyer to the King Of theMarket, it has become utmost essential to give a name to the essential food crop of India to survive in the international market. The brand is the new mantra for success and basmati, also known as the 'king of rice', is in the midst of the action.Of the total domestic basmati consumption of 3.5 lakh metric tonnes, branded basmati accounts for about 1.25 lakh metric tonnes and has been growing at the rate of 20 percent a year. The Indian branded basmati market is estimated to be worth betweenRs. 600-700 crore. Rice producers have picked up the market trend towards preferencefor branded basmati and have jumped on to the bandwagon so that there are more than100 regional brands of rice in India. Some famous brands available in India, USA,Canada, U.K., Norway, Denmark, Holland, Sweden, Australia, Kuwait, SaudiArab ia, UAE

and many other countries are as follows : Lal Qilla Double Diamond Brand Basmati Rice Resham brand Tilda Basmati rice Pari Basmati Rice Adora Basmati Dawat Basmati Kohinoor Basmati Blue Label Basmati Lal Haveli Basmati FACTORS INFLUENCING THE PRICE OF RICE 1.Weather: Role of weather in rice production is immense. Temperature, rainfalland soil moisture are the important parameters that determine the crop condition.Further, natural calamities can also affect crops. Markets keep watch of thesedevelopments. 2.Minimum Support Price:

Changes in the minimum support prices (MSP) by thegovernment also have immense impact on the price of rice. 3.Substitute Product: Availability of substitute products at cheaper rate may leadto weakness in demand. This situation happens especially when the main products price tends to become higher. 4.Consumption: Rice consumption depends on two factors - population andincome. For example, rice is the staple food of Asia. Low-income groups consumemore rice according to the per capita income increase. But as the incomeincreases, there arrives a point when the consumption starts to dip. Income growthand reduction in population result in a low consumption of rice. 5.Seasonal cycles: Seasonal cycles are present in rice cultivation. Price tends to belower as harvesting progresses and produce starts coming into the market. At thetime of sowing and before harvesting price tends to rise in view of tight supplysituation. 6.Demand: Import demands as well as domestic demand influences the price of ricein domestic as well as international market. 7.New technology: Breakthrough in the technology may increase the productivityand would lead to more supply. This may bring some softness in the price. PROBLEMS OF RICE EXPORT FROM INDIA India is facing stiff competition in the world markets for export of rice. Besides,there are many domestic problems for rice exporters. If these internal problems arerelaxed to the extent possible, the exporters may find easy way to boost rice export andsuch measures will go a long way to sustain the exports. Some of the major problemsare:

1.High tax rate: Indian rice iscostlierin the international market as compared to other competing countries in the world because of imposing of various taxes on riceexports. These taxes include-Purchase Tax (on indirect export), Market Fees,Rural Development Fund, Administrative Charges, etc.

as per the stateGovernment policy. In Pakistan, rice meant for exports specially the branded ones,duties are extremely low or duty free. 2.Minimum Support Price: TheMinimum Support Price (MSP) for paddy is enhanced every year by the Government of India. Due to MSP, farmers are free tosell in the open market or to the Government at the MSP depending on what is moreadvantageous to them.