Imposing yet another restriction, the European Union has demanded mandatory certification from Indian authorities for every imported Basmati consignment as belonging to specific strains of traditional varieties to be eligible for customs duty concessions.
The world's largest trading bloc also wants the samples of imported basmati drawn from Indian consignments to be tested in New Delhi itself.
"From April 15 we are certifying cargoes as traditional basmati, for them to be able to avail the benefit of 250 euro a tonne duty concession. EU now wants even the specific variety of basmati be identified in the carton itself," chairman, Agricultural and Food Products Export Development Authority K S Money told PTI.
He said customers were more interested in traditional basmati and to identify one of the six varieties to which a cargo belonged was not required.
Furthermore, even after the consignment has the stamp of approval of the Export Inspection Council, the EU wants to send its samples for testing back to India.
Money said this is going to be a costly affair but the EU does not want to bear the expenses. Traders, however, fear that if India concedes to the demand, EU could flood the testing authorities using one pretext or the other to reject the samples.
The other view is that since EU is in the process of renegotiating the rice import regime, agreeing temporarily to their new set of demands would not make much difference.
Negotiations under Article 28 of the WTO are still on and Money said they are likely to conclude shortly.
Being the principal supplier, the stand taken by the US takes precedence over India, he said adding India will want the present 250 euros a tonne concession on brown basmati to be retained under the new regime.
"We fear they may do away with the concession which would be unfair as it had been given in the first place to protect the interest of their domestic farmers and benefit the millers," he said.
Duty free husked rice ensures that the millers in the EU get cheaper high quality rice for processing, thus making a killing in the domestic market. Money said there was a likelihood of the EU arriving at a fixed duty in terms of euros a tonne but India is forcefully presenting its case for zero-duty on traditional basmati.
"As for Pusa or hybrid variety of basmati, we will settle for anything offered to Pakistan's 'super' variety", he added.
The EU having slashed its rice intervention price by nearly half to euro 150 a tonne, India at present runs the risk of losing the tariff concessions it enjoys on basmati unless it successfully negotiates the new trade regime.
Having painstakingly created a large market for basmati rice in Europe in the last 10 years, India wants duty-free imports into Europe of brown basmati to continue for the traditional variety.
The 250-euros-a-tonne duty abatement on brown (husked) basmati has already been withdrawn for the hybrid varieties including India's Pusa and Pakistani "Super" and the concession is now available only for traditional varieties.
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