Rice imports from India jump to Rs 14.43 billion

Nepal’s rice imports from India jumped to a staggering Rs13.43 billion in the first eight months of this fiscal year, according to a Nepal Rastra Bank (NRB) report.

In the same period last year, rice and paddy imports bills stood at Rs9.91 billion. Agro experts said the figure represents a significant imbalance in what Nepal grows and eat.

“Irrigation, inputs and manpower are extremely important for food production. We lack of all these resources. Hence, the imbalance between production and consumption has been growing every year,” said Hem Raj Regmi, deputy director general at the Central Bureau of Statistics.

This fiscal year, even as the imports of most of the commodities from India have dropped due to a six-month-long trade embargo since September last year, rice imports continued to rise.

“Imports of food grains are expected to rise further as the winter crop harvest, particularly wheat output, has been projected to be dismal,” he said. “Already, Nepal’s paddy output last summer had dropped by more than 10 percent and deficit has been visible in the market with such an alarming imports bill.”

According to Regmi, rice-culture is still a general food habit in Nepal and if the paddy production drops, the deficit is offset by imports from India.

Food Imports bill has also been spurred by increasing disposable incomes of the Nepalis. “Obviously, rising income means, people prefer to eat imported foods,” he said, adding for instance, the import of basmati rice has been increasing in a dramatic way.

The central bank’s statistics show along with rice and paddy, imports of other agricultural commodities like vegetables and fruits have also jumped sharply. However, despite the jump in the imports, it has not affected prices in the market.

Looming Indian export ban

According to reports, about 330 million people in India are affected by drought, as the country reels under severe water shortages and desperately poor farmers suffer crop losses.

The impact of drought in India is likely to affect Nepal, said Bhola Man Singh Basnet, an agro scientist. “As Nepal will be facing food deficit due to poor summer harvest and projected drop in winter crops, we need to be extra cautious about the increasing concerns of India’s agricultural sector this year.”

For example, when the world suffered a worst food crisis during 2007-08, India had enforced a trade ban on several key food items to Nepal. “The episode could repeat again amid reports that farmers in India are likely to suffer crop losses due to drought and water shortage,” Basnet said. “The government should be proactive to maintain sufficient food stock so that India’s food exports ban will not affect Nepal.”

Indian metrological officials have forecast an above-average monsoon this year, offering hope for the struggling farmers. The same trend is reflected in Nepal and if it happens, food pressure will be eased from the next year, Basnet said.

The Agriculture Ministry has projected the country might face food deficit of 800,000 tonnes this year if wheat production drops sharply. The agriculture sector employs about 66 percent of the population and contributes 33 percent to the GDP.

Source: The Kathmandu Post. Date: April 24, 2016

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