From G-20 to the BRICS, Indian Prime Minister, Narendra Modi, has successfully been adopting an all-inclusive approach to the developing countries of Asia, Africa and other areas, including the least developed among them, to share Indian experience, including assisting them in tackling their perennial problem of hunger, with liberal exports of food-grains, including broken rice. The policy, however, lost its focus during the past two years; even the Union Minister, Piyush Goel, being assigned to resolve the issue, finds himself being checkmated.

In spite of being his known proximity to Modi, Goel could not discontinue the repressive regulations regarding the exports of food-grains, especially in the case of exports of broken rice. During the last quarters of the year 2023, perhaps, it was the intervention of the country’s apex leadership that the Mandarins in New Delhi could partially relax the exports of the broken rice to the tune of nine thousand metric tonnes to five countries, including Senegal, Mali, Gambia, Indonesia and Bhutan. It, however, was just a face-saving, because the recipients were worried about the delays from India for their common people. 

It had taken almost 14 months to allow the exports of the cheaper rice, which for many countries is a lifeline. It was banned in September 2022. In December 2023, New Delhi had reluctantly agreed to resume the broken rice to the needy countries. The restrictions imposed under the pretext of manufacturing ethanol continues to haunt the farmers across the country. Their leaders are being accused of the agents of the Khalistan or some other foolish accusations by the government’s friendly media, but it did not care to explain that why the Food Corporation of India (FCI) could not purchase rice even with the huge budget sanctioned by the North Bloc, which houses the finance ministry. The studies of the Financial World explain that due to the export’s restrictions, the FCI warehouses have little space for the new crop. 

The much-trumpeted claim that the restrictions of the broken rice was being imposed to provide cheaper raw material for the production of ethanol. The manufacturers of ethanol continue to prefer other sources, especially the sugar cane, which is a much cheaper ingredient than the broken rice. It is also believed the exports restrictions were imposed for keeping the retail prices low for the common people during the elections, but the price-rise was noticed to the tune of 11 per cent during this period.

Impact on Rice Exports

It is estimated that India earns approximately Rs. 6000 crores annually from the exports of broken rice to a large number of countries, especially those, which face perennial food shortages. In October 2023, the government had approved exports of 1.34 metric tonnes of non-Basmati white rice. This policy helped countries like Philippines (.29 MT), Cameroon (.19 MT), Malaysia (.17 MT), Ivory Coast (.14 MT), Republic of Guinea (.14 MT), Nepal (90,000 tonne) and Seychelles (800 tonnes). In September 2023, UAE, Singapore and Mauritius were also supplied this variety of rice.

It also has been reported that a large number of the FCI ware-houses are also not being properly maintained. It is to be ascertained that how much the losses, the country is going to suffer due to their mismanagement.

Ethanol Fiasco   

Interesting, there is a belated realization among people like Abinash Verma, a civil servant, who had been favouring the grain-based ethanol plants, that food-grains being made available by the FCI to the ethanol manufacturers are too costly as an in-put. He also agreed before the food-grain traders through the Chine mandi, that on August 28, FCI conducted the e-auction, and the FCI rate for rice is around Rs.31.5 per kg; further, if it was brought from their go-down to the ethanol manufacturing unit, another 50 paisa or one rupee would have to be added in the input cost.

Verma has further explained that the cost of the rice-based ethanol costs approximately Rs. 72 per litre, while the current market price is only Rs.58.50 for obtaining the same amount of the ethanol.

There are other dimensions of the ethanol manufacturing; according to some economists engaged in the study of the agriculture-based businesses, the Maize, perhaps, could be a better option for the ethanol manufacturing.  It is also claimed in the statistics of the NITI Ayog, that the sugar cane consumes less water than the rice and maize, but it is yet has to advice the concerned ministries.

Another issue needs the government attention is that while in Brazil, the sugar is considered a by-product and the ethanol, which is being used for running vehicles, is the main product of the sugar mills. However, few expect that for such a historical step, any cabinet minister can even dare to take any initiative in New Delhi; therefore, it is natural for the ministers to await the directions from the apex or PMO.

Gopal Misra has been associated with national and international media. His books on journalism and geo-politics have been well-appreciated. Views are personal.