New Delhi: The Centre has scrapped import
duty on rice till September 2010 to augment domestic supply,
as the twin-impact of drought and floods have deepened fears
of a dip in output by as much as 16 million tonnes this year.
"It is notified that the customs duty (70 per cent) on
rice has been scrapped till September 2010," a senior official
with the Central Board of Excise and Customs said.
A tax expert said the customs duty has been abolished for
"semi-milled or wholly milled rice, whether or not polished or
glazed".
Sources had said in a meeting last month, the empowered
Group of Ministers (eGoM) on food, headed by Finance Minister
Pranab Mukherjee, had recommended that the import duty on rice
be scrapped.
The government had earlier allowed duty-free import of
rice between March 20, 2008 and March 31, 2009 as part of its
measures to control inflation. The customs duty was restored
from April 1.
The latest move came after drought in about half of India
and subsequent floods in Andhra Pradesh, Maharashtra and
Karntaka ravaged the most important summer-sown crop — paddy.
Rice prices have already shot up by about 25 per cent in
the last four months on apprehension about production.
Earlier, Finance Minister Pranab Mukherjee had said rice
production could decline by 16 million tonnes this year in
view of drought and floods. India produced 99.15 million
tonnes of rice in 2008-09.
Though the government has piled up enough reserves of
foodgrain — about 47 million tonnes of rice and wheat till
August-end — it has scrapped the duty, as fears about a dip in
procurement this year looms large.
The government purchased record 33.3 million tonnes of
rice in 2008-09 because of a bumper production.
Bureau Report
First Published: Tuesday, October 27, 2009, 15:12