The global impact of the Covid-19 pandemic, of the climate crisis and the Russian invasion of Ukraine has led to a significant increase in the number of people experiencing hunger. According to the latter United Nations Global Report on Food Crisesan additional 122 million people suffered from hunger last year compared to 2019. However, a new challenge has now emerged. India has banned the export of white rice, which is not basmati. The country is the world’s largest exporter of rice, and this variety accounts for 25% of its annual international sales. Combined with the previous ban on exports of broken rice (broken rice), this new restriction has raised concerns about global inflation and greater food insecurity for vulnerable populations.

Rice is a staple food for over three billion people (almost half of the world’s population) and almost 90% is grown in Asia. The price of rice remained more affordable than wheat or corn, even after the start of the war in Ukraine. However, the El Niño phenomenon has affected rice fields, raising production costs and causing a 15%-20% increase in global prices since last September, according to the International Food Policy Research Institute (IFPRI). The monthly rice price index published by the Food and Agriculture Organization (FAO) shows that in July it reached the highest level since 2008.

To address this situation, India is changing its export policy for white rice, which is not basmati. The aim is to ensure adequate availability in the local market and prevent price spikes at national level.

India’s rising consumer price index (CPI) is a politically sensitive issue for the prime minister, especially ahead of regional elections later this year and general elections in April 2024. Cereals form an important part of the diet of the world’s most populous nation, especially in lower income groups. However, exporting grain is more profitable than selling it domestically. Prices of white rice – not basmati – in India have risen 11.5% this year, according to government data.

“We understand the government’s motivations. Indian authorities are trying to ensure food security while dealing with inflationary pressures“, said Luis Breuer, representative of the International Monetary Fund for India. “The IMF is urging all nations, including India, to eliminate these types of export restrictions. They can have harmful global effects».

India is the second largest producer of rice in the world. China holds the top spot, but most of its rice is destined for domestic markets. India has been the leading exporter of rice for almost a decade. In 2022, it sold 22.3 million tons in more than 140 countries, accounting for 40% of the global market share. These impressive figures were achieved despite the implementation of a restriction on shipments of broken rice in September and the imposition of an additional 20% duty on high-quality rice exports.

Forty-two nations rely on India for more than half of their rice imports. Some of the countries that depend heavily on Indian rice are Bangladesh, Nepal, Benin, Senegal, Ivory Coast, Togo and Guinea.