Pakistan Shrugs Off Indian Rice Subsidy Push as Exports Held Strong

India re-entered the global rice market after a two-year export pause aimed at securing domestic food supplies. With this return, Indian media and trade observers predicted a major disruption for Pakistan’s thriving rice exports, especially given India’s use of government subsidies to drive down prices.

Contrary to expectations, Pakistan’s rice export industry remained largely unaffected. From July to September 2024, before India resumed exports, Pakistan was shipping an average of 550,000 tonnes of rice monthly. Even after India’s return from October 2024 to March 2025, Pakistan’s rice trade held its ground.

Sector analyst Hamid Malik noted that Pakistani exporters deliberately avoided a price war, instead leveraging agility and premium quality to retain their market share, particularly in high-end markets like the UK and EU, as well as price-sensitive African regions.

Export Volume Remains Steady Despite Subsidy Pressure

According to the Pakistan Bureau of Statistics, rice exports during the first 11 months of FY25 reached 5.544 million tonnes, only slightly down from 5.593 million tonnes during the same period last year. This marks a minimal decline of 0.87%, highlighting the resilience of Pakistan’s exporters.

However, concerns are growing over future performance. A 3.7% drop in rice production during Kharif 2024 has led to shrinking stocks since April 2025. Industry forecasts predict a 15% decline in rice exports for the April–June 2025 quarter due to tight supply.

India’s Pricing Under WTO Fire

India’s current export price of $349 per tonne for 25% broken non-Basmati rice makes it the cheapest global supplier, below Thailand ($376), Vietnam ($362), and Pakistan ($365). Yet, when actual costs, including a $265 MSP and $55 in logistics, are factored in, India’s real FOB price should be closer to $385, exposing heavy subsidisation.

This has drawn international criticism. The United States, Canada, Australia, and New Zealand have formally approached the World Trade Organization (WTO), accusing India of breaching the Doha Agreement’s 10% subsidy cap.

India Faces Decline Despite Subsidies

Ironically, despite these aggressive measures, India’s rice exports dropped sharply in April and May 2025, a year-on-year fall of 50%. Critics within India blame the policy for supply mismanagement, excessive ethanol diversion, and failures in public food distribution.

India’s Food Corporation is reportedly sitting on 39 million tonnes of rice and 19.5 million tonnes of paddy. The removal of the Minimum Export Price (MEP) further complicates its global competitiveness.

While Indian rice remains under global scrutiny, Pakistan’s rice exporters continue to prioritize discipline, quality, and strategic market engagement. As shifting international dynamics unfold, Pakistan remains focused on sustaining its hard-earned gains in the face of subsidy-fueled competition.