Rice Industry Overview and Outlook

RICE | LOCAL INDUSTRY India & Pakistan | The Basmati Competition Basmati Price | India Vs. Pak | USD/MT Parameter Pakistan India 1,200 Agriculture growth 2.67% 3.40% 1,000 800 Agriculture, value added (% of GDP) 19% 16% 600 Population (min) 220 1,356 400 Rural vs. Urban population share 64:36 69:31 200 0 Area Rice (mln Hectares) 3.0 44 CY16 CY17 CY18 CY19 9MCY20 Production (mln MTs) 7.4 118 India Basmati Pak Basmati Basmati Rice is exported to the EU and Middle East by both Pakistan and India. As basmati rice is considered high quality premium grade, it earns healthy foreign exchange for both countries. Price and quality competition, therefore, exists among India and Pakistan. Lately, India's exports of basmati rice have decreased in the EU owing to a failure of its producers to meet increasingly strict EU standards on the use of pesticides. This created an opportunity for Pakistan to increase its footprint in the EU market. Basmati proportion in the total country exports, therefore, increased in FY20. However, India's latest stringent efforts to secure a Geographical Indication (GI) tag from the EU may result in Pakistan losing its market share to India, if India succeeds in doing so. Strategical growth strategies need to be adopted by Pakistan to secure its position in the basmati arena. Source: Thai Rice Index, PES 19 PACRA

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