China permits Indian basmati rice imports

Category: Global Economy Sub-category: Indian Economy
Document type: news

27-Apr-2012 | 11:35 IST | Edited by:Sharmila Maitra

Chinese authorities at last have given their head nod in favour of the Indian exports of basmati rice following a long and tortuous six-year process that has been seen as underscoring the difficulties of navigating the complex bureaucratic hurdles that bar the Indian entry into the China market.

China's General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) announced last week it would allow imports of basmati rice from India.

This should be noted that the negotiations were on since 2006.

Indian exporters can begin shipping basmati rice to China after both countries agree on a mutually satisfactory quarantine protocol. Once a quarantine certificate is agreed by both sides, China will have to circulate the certificate to all its ports and customs authorities before imports can begin entering the country.

Indian industry groups have estimated between $50-100 million potential trade. However, the move will have little impact on the overall trade relationship, the trade deficit between both countries reached $27 billion last year in China's favour, with bilateral trade reaching a record $74 billion.

There are, however, two substantial barriers that the Indian exporters will face while entering this market. They are the established presence of Pakistani basmati rice brands and the niche demand for the product, largely from international five-star hotels and the small number of Indian restaurants in China.

However, India is still waiting for the green light for more than a dozen other agricultural products.

China has also granted landing rights to Zee Television after another six year-long process.

Both these decisions have been a long time coming.

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General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China (AQSIQ) is a ministerial administrative organ directly under the State Council of the People's Republic of China in charge of national quality, metrology, entry exit commodity inspection, entry-exit health quarantine, entry-exit animal and plant quarantine, import-export food safey, certification and accreditation, standardization, as well as administrative law-enforcement.