India rice export curbs to boost world prices

By Biman Mukherji

NEW DELHI (Reuters) - Indian restrictions on rice exports will spur global prices and help fellow exporters like Pakistan and Thailand because overseas sales from India will fall to a fraction of last year's, a trade body said.

Exports from India are likely to fall to 250,000 tonnes this financial year from 5.5 million tonnes in 2007/08, Sanjay Sethia, president of the All India Rice Exporters' Association, told Reuters in an interview on Tuesday.

"Pakistan, Thailand and other exporting countries will make money, while India will lose out," he said.

India banned non-basmati exports on Monday to try to ease pressure on prices, which has pushed wholesale price inflation to a 14-month high.

"It is a hasty decision and needs to be relooked at by the government. Unnecessarily, India could end up inflating world prices," Sethia said.

Governments from Cairo to Manila have announced steps to ensure domestic rice supplies at a time global stockpiles have halved and prices have doubled to multi-year highs.

"I feel that India's exports will now fall to about 250,000 tonnes during 2008/09, as only some traditional basmati rice can be exported," he said.

He said Pakistani and Thai rice traders had increased prices by about $150 to $200 per tonne on some rice grades after India raised the minimum export price for non-basmati rice last week to $1,000 per tonne from $650 per tonne free on board.