President Trump may impose tariffs on rice imports from India, according to various media reports. At a meeting in the White House with American farmers, who represent a key constituency and are facing higher costs and market challenges due to tariffs, Trump claimed India was dumping rice in the US.
“Why is India allowed to do that (dumping rice into the US)? They have to pay tariffs. Do they have an exemption on rice,” he asked Treasury Secretary Scott Bessent.
“No sir we are still working on their trade deal,” was the reply.
“But they shouldn’t be dumping. I mean, I heard that. I heard that from others. They can’t do that,” Trump was reported to have said.
That led to discussion about an ongoing World Trade Organisation case against India where the US has complained about the export subsidies Delhi provides.
According to the Global Trade Research Institute (GTRI), even if Trump decides to impose tariffs, the US bought less than $400 million worth of rice mostly basmati, from India. That’s about 3% of the total rice India ships overseas.
“The Indian rice export industry is resilient and globally competitive,” said Dev Garg, Vice President, Indian Rice Exporters Federation. “While the US is an important destination, India’s rice exports are well-diversified across global markets.
Before the latest duty revision, Indian rice imports were subject to a 10% tariff in the American market. The recent increase has elevated this to 50%, said a report in the Times of India. Nevertheless, it said, exports have persisted, demonstrating the product’s fundamental importance to consumers.
Market observations show that American consumers are bearing the majority of the increased tariff costs through higher retail prices, whilst Indian producers and exporters maintain their previous revenue levels.
The main rice export markets for India are in the Gulf states and places where there is a large resident Indian-origin population. With the growing popularity of Indian cuisine and dishes like biryani, that are made only from basmati rice, exports to these places remain strong.
