In a significant turn of events, the United States has slapped a hefty 50% tariff on Indian basmati rice as part of broader trade sanctions tied to India's energy and trade ties with Russia. While other sectors received exemptions, basmati rice remained fully exposed. In stark contrast, Pakistani basmati continues to face only a 19% duty, giving it a meaningful price advantage in the lucrative US market .
Pakistan’s Basmati Exports on the Rise
According to the Rice Exporters Association of Pakistan (REAP), exports of Pakistani basmati have surged. In fiscal year 2024, Pakistan shipped about 772,725 tonnes, earning $876.9 million, a notable jump from 595,120 tonnes worth $650.4 million in the previous year. The average price per tonne also climbed from $1,092.93 to $1,134.86 .
Between November 2023 and October 2024, the United States accounted for 24% of Pakistan’s total basmati shipments, making it the largest market. Italy and the UK followed with 14% and 11%, respectively .
Growing Demand for Aromatic Rice in the US
A broader trend is at play. The US Department of Agriculture (USDA) reports that rice imports have climbed from 7% of domestic consumption in 1993–94 to over 25% by 2022–23, with more than 60% of those imports being aromatic varieties like basmati and jasmine .
As demand for fragrant rice grows, the tariff gap between Indian and Pakistani basmati gives Pakistani exporters a competitive edge in filling that gap.
Market Shift: Indian Basmati Likely to Suffer
Industry insiders predict Indian basmati exports to the US could drop by 50–80%, pushing its price toward $1,800 per tonne. Meanwhile, Pakistani basmati remains more affordable, at around $1,450 per tonne, making it an attractive alternative for US importers .
Retailers across the US are already reporting heightened demand for Pakistani rice, and Indian consumers may soon feel the impact directly—either paying significantly more for Indian rice or switching to the more budget-friendly P
akistani option .
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