New Delhi: Following the Russia-Ukraine conflict, the dark clouds of the ongoing war in the Middle East have now cast a severe shadow over the export of India’s aromatic Basmati rice. Due to supply chain disruptions caused by the war, approximately 4 lakh tonnes of Basmati rice are currently stranded at various ports.

This has resulted in the stalling of transactions worth thousands of crores, sparking deep concern among exporters and farmers alike.

Accumulation of Rice at Ports: What are the Reasons?

Middle Eastern countries are the largest market for Indian Basmati rice. However, under the current circumstances, the following factors have hindered exports:

Suspension of Ship Movements: As maritime transit near war-torn regions has become dangerous, many shipping companies have temporarily suspended their services or diverted their routes.

Increased Insurance Costs: Due to the fear of war, sea freight insurance premiums have skyrocketed. This has turned into a heavy financial burden for exporters.

Payment Delays: Disruptions in the banking systems of war-affected countries have led to significant delays in payments for exported goods.

Anxiety Among Exporters

There is a growing fear that the quality of the rice may deteriorate due to prolonged storage at the ports. Furthermore, rising warehouse rentals and maintenance costs have left exporters distraught. It is estimated that rice worth over ₹3,000 crore is currently stuck at ports, unable to be loaded onto ships.

Impact on Farmers

If the export process slows down, the surplus stock of Basmati rice in the domestic market is likely to cause a price crash. This will directly hit the income of farmers in Punjab, Haryana, and Uttar Pradesh, who are the primary growers of Basmati.

Challenges Before the Government

For the Central Government, which has already imposed certain restrictions on rice exports, this new problem arising from the war has become a major challenge. Businessmen are appealing to the government to help find alternative markets or provide concessions on transportation costs. These signs suggest that the crisis may continue until peace is established in the Middle East, potentially leaving a long-term impact on India’s agricultural economy.