Import duty on rice reduced to nil

By Vijay Kumar

CAN you imagine India importing rice? India is the major exporter of rice in the world and normally we would not think of importing rice. That perhaps is the reason why import of rice attracts a high Customs duty of 70%. But all this changed in early 2008 with recession and inflation.

In a bid to check inflation, Government of India by Notification No. 37/2008- Cus , Dated : March 20, 2008, fully exempted import of rice from Customs duty for a period of one year – till 31st march 2009. [This was done by suitably amending Notification No. 21/2002- Cus.]

On 1 st April 2009, this notification expired and import of rice again went back to the 70% Customs duty.

But rice is still costing Rs. 40/- a kg. Just three weeks ago, Commerce Minister Anand Sharma stated that there is no proposal to again exempt customs duty on import of rice as “we have sufficient stocks in the country”. It is strange that Commerce ministers rush into give statements concerning the Finance ministry – which always has an upper hand.

On Monday, the Pakistani newspaper, DAWN reported that China and India had imposed a ban on import of rice, which would certainly lead to a decrease in Pakistan's export.

Both Anand Sharma and DAWN are wrong – the Government has just exempted Semi-milled or wholly-milled rice, whether or not polished or glazed from the whole of the Customs Duty. This exemption will be valid till 30 th September, 2010.

The Government has amended Notification No. 21/2002-Customs, dated the 1st March, 2002, as follows:-

A) in the preamble, in the proviso, after clause (iaf), the following clause shall be inserted, namely:-

“ (iag) the goods specified against S.No . 22AC of the said Table on or after the 1 st day of October, 2010”

B) in the Table, after S.No . 22AB and the entries relating thereto, the following S.No . and entries shall be inserted, namely:-

It took our team a couple of hours to understand what this was all about. The CBEC should have given a Press statement exclaiming the great economic decision. The PR wing of the Board should be a little more active – after all the benevolent steps of the government need to be publicised.

Notification No. 118/209-Cus., Dated: October 14, 2009