Bangladesh's Duty-Free Import Announcement Triggers Rice Price Surge in India

Following Bangladesh's announcement to import 500,000 tons of rice duty-free, the rice market in India has witnessed significant upheaval. Within just two days, rice prices in India have surged by up to 14%. The rush by Indian traders to export rice to Bangladesh has created a temporary imbalance in domestic supply and demand.

Traders in West Bengal, Uttar Pradesh, and South India revealed that they were aware of Bangladesh's plan to temporarily waive the 20% import duty on rice. As a result, they had already prepared stocks at warehouses near the Petrapole border.

On Wednesday, the Bangladesh government officially announced the withdrawal of the 20% import duty on rice. Following this, Indian traders have been eagerly exporting rice to Bangladesh. According to a report by *The Economic Times*, after Bangladesh’s duty waiver announcement, retail prices of rice in India have risen sharply. The price of Swarna rice has increased from 34 rupees to 39 rupees per kilogram. Similarly, Miniket rice has gone up from 49 rupees to 55 rupees, Ratna rice from 36-37 rupees to 41-42 rupees, and Sona Masuri from 52 rupees to 56 rupees per kilogram.

Swarna rice is in demand across India, while Miniket rice is particularly popular in East and Northeast India. Ratna rice is widely consumed in North India, and Sona Masuri is a top choice among South Indian consumers.

Suraj Agarwal, CEO of Riceville, a rice export and marketing firm, stated that after the Bangladesh National Board of Revenue announced the duty waiver on Wednesday afternoon, trucks carrying rice from India began entering Bangladesh that same night.

To stabilize the domestic market and provide relief to consumers amid rising inflation, the Bangladesh government announced the duty waiver on rice imports. In the 2024-2025 fiscal year, rice prices in Bangladesh have risen by 16%. To meet domestic demand, the country had to import 13 lakh tons of rice during this period.

He added, “Considering both cost and transportation, exporting rice through the Petrapole-Benapole border is convenient. This is why factory owners from Uttar Pradesh and South India are also exporting rice to Bangladesh via this land route.”

C.K. Rao, a rice mill owner from Andhra Pradesh, said, “My trucks headed for Bangladesh on Thursday morning.”

Keshav Kumar Haldar, Managing Director of Haldar Venture Limited, a rice export company, noted that there is an oversupply of rice in the global market, and both government and private stocks in India are in good condition. This has led to a decline in global rice prices. Bangladesh’s import order has created demand in the Indian market, helping to partially offset the global price drop and revive market activity.