EU sets December 31 deadline to adhere to new Basmati import norms

A shopkeeper arranges signs with prices on bags of rice at a shop in Mumbai March 19, 2009. Indian inflation headed towards zero in early March and analysts tipped it would soon turn negative, opening the way for the Reserve Bank of India to cut interest rates further to prop up demand and growth. The wholesale price index, India's most widely watched inflation measure, rose 0.44 percent in the 12 months to March 7, sharply lower than the previous week's 2.43 percent and below a forecast of 0.89 percent in a Reuters poll. REUTERS/Arko Datta (INDIA BUSINESS FOOD DRINK) - RTXCYWA

The European Union has given time to India till December 31 to meet the bloc's new norms on importing Basmati rice, Minister of State for Commerce and Industry CR Chaudhary said today.

The new norms set by European Commission bring down the maximum residue limit (MRL) level for Tricyclazole (a fungicide) in Basmati rice to 0.01 mg per kg from next year. The norms are applicable on all rice-exporting countries.

"The European Union has asked us not to send Basmati rice to them because of some plague or technical points. We requested them to at least give us time, we have to make the farmer aware not to use this pesticide. They have given us time till December 31, 2017. But we have to maintain our quality," Chaudhary said while addressing a conference organised by Assocham here.

However, experts believe it may take two crop cycles for India to meet the new import norms.

Two aromatic Basmati varieties - PB1 and 1401 - are maximum exported to the EU. The shipments of these varieties with Tricyclazole MRL at 0.03 mg per kg were accepted so far from India.

According to industry experts, Pakistan stands to gain from the new norms as it does not use Tricyclazole on its crop and is looking at the opportunity to ship more from January 2018, even as India's Basmati exports to the bloc worth around Rs 1,700 crore are likely to be hit. India, the world's top rice exporter, shipped 3.5 lakh tonnes valuing Rs 1,744 crore of Basmati to the EU in 2016-17. The Basmati export to the bloc comprises 10 per cent of the total 40 lakh tonnes undertaken annually, as per the industry data.

Besides, the minister exuded confidence that India will be among the top 50 nations in ease of doing business ranking in 2019 on the back of implementation of GST.

"After the GST is factored in, we will certainly be in the top 50 when the World Bank releases its Doing Business report in 2019," Chaudhary said.