The Chinese don’t eat Basmati
April 24, 2012

Its one of those moves where you ask ‘was all that effort worth it?’

India on Tuesday celebrated China’s final approval for importing Basmati rice, the highest varient of the grain considered the top dog amongst its kind, the basmati grain, long and with a beautiful aroma has since long been the highlight of a juicy pulao, revered by kings and adored by those in the west as supreme amongst its kind, India has prided itself in being a basmati rice growing nation.  It took Indian six years to gain approval, permissions, pass papers and push the cause and finally now Basmati can be exported to the world’s largest consumer of rice.

Indian diplomats who saw the deal to fruition laud it for realigning the trade deficit between China and India. Indian industry groups have estimated the rice to bring between US$50-100 million in potential trade – the trade deficit in China’s favour is more to the tune of US$27 billion last year – a drop in the ocean in comparison.

Further, China the worlds largest rice consuming nation – rice is consumed for breakfast, lunch and dinner, is a staple diet, no meal being complete without rice, eat a version of short grain, sticky rice which can easily be lopped up by chopsticks. Basmati being famed for its single long grains is not only difficult to eat with chopsticks, Chinese cuisine and the palate isn’t accustomed to it. This leaves a very small market of Indian restaurants and International five-star hotels who will serve the rice in China. And so, while we laude the Indian governments success in exporting the grain to China, we ask is it worth the effort? Would it have made more sense to export the grain to a nation that actually appreciates the rice – like Africa or South America?

Lastly another barrier the basmati will face is that due to Pakistan’s friendly relations with China, Pakistani basmati rice is already being exported to the Middle Kingdom, while considered not be as high in quality as Indian basmati, being the first mover, Pakistani basmati has already captured a majority of the potential market, leaving Indian basmati exporters with very few options.

The long, six-year process that began in 2006 has underscored both the difficulties of gaining entry into the China market and the reluctance of Chinese authorities to allow agricultural and food products from India. India is still waiting for the green light for more than a dozen other agricultural products.

Following Mr. Hu’s 2006 visit, it took almost three years – until September 2009 – until an AQSIQ team even responded to an invitation from Indian officials to visit India.

An AQSIQ team toured rice mills and held talks with officials in the Ministry of Agriculture during the visit. In December of that year, India submitted an exhaustive report to Chinese authorities, running into hundreds of pages, detailing the pesticides use, climate conditions, soil type and processing and storage procedures that were being followed.

After hearing no response from the Chinese side, Minister of Commerce and Industry Anand Sharma raised the issue in January 2010 during the eighth meeting of the Joint Economic Group (JEG) meeting in Beijing.

The issue was raised again this year at another working group meeting between officials at the joint secretary-level.

The BRICS Summit in New Delhi last month was seen as giving much-needed momentum to several pending trade issues.

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