How serious an impact will reduced rice supplies have on the Arab world following India’s export ban?

Rice is a food staple in the Gulf but India’s ban on the export of non-basmati varieties owing to delayed sowing could lead to price hikes. (AFP)
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Updated 02 August 2023
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How serious an impact will reduced rice supplies have on the Arab world following India’s export ban?

  • Indian decision to prioritize the domestic market follows delayed monsoon rains and price rises
  • Effect of reduced supplies and higher prices to vary from country to country in the Middle East and North Africa

DUBAI/NEW DELHI: India’s decision to ban the export of several varieties of rice in order to ensure sufficient supplies at home is pushing up prices on the global market, a development whose impact on food-insecure countries is being viewed with concern by experts.

Although the ban does not include the popular basmati variety, which is a staple at Gulf dinner tables, it is triggering an increase in the prices of all rice varieties, adding to the vulnerabilities of import-reliant economies of the Middle East and Africa.

While the Indian restrictions might contribute to food price inflation in the Arab region, economists who specialize in the field of agriculture do not anticipate a rice shortage.

“The impact is not going to be restricted to exporters to the Arab countries, nor rice production levels in the Arab region,” Fadel El-Zubi, lead consultant for the UN Food and Agriculture Organization in Jordan and the agency’s former chief in Iraq, told Arab News.




Pierre-Olivier Gourinchas, chief economist at the International Monetary Fund, said last week that the move would increase price volatility and should be reconsidered. (AFP)

“The impact will be seen on global prices in stock exchange markets.”

He said the price increases would not be limited to the cereal coming out of India but would apply to rice produced in other markets too, from the US to Australia.

“This is going to be the main impact. Yet, the increase in prices won’t be similar to the increase in wheat prices. (Also) the increase in rice prices will be for a short term. This is my expectation.”

El-Zubi was referring to the soaring price of wheat on the world market as a result of the war between Russia and Ukraine, which before February 2022 were jointly responsible for almost a third of the world’s wheat and barley production.

Russia’s blockade of Ukraine’s Black Sea ports following its invasion led to fears of grain shortages and spiraling food prices, whose impact would have been felt most by the world’s most food-insecure nations, particularly in Africa.

Last summer, a UN- and Turkiye-brokered deal between Russia and Ukraine allowed both nations to continue exporting grain. But earlier this month, Moscow withdrew from the Black Sea Grain Initiative, renewing fears of food-price inflation.

The ban on exports of non-basmati white rice imposed on July 20 by India — the world’s largest supplier of rice, accounting for almost 40 percent of global trade — has added to those fears.

Responding to the Indian decision, Pierre-Olivier Gourinchas, chief economist at the International Monetary Fund, said last week that the move would increase price volatility and should be reconsidered.

“In the current environment, these types of restrictions are likely to exacerbate volatility in food prices in the rest of the world and they can also lead to retaliatory measures,” he said.

“We would encourage the removal of these type of export restrictions because they can be harmful globally.”

But Indian food policy analyst Devinder Sharma believes the ban was the correct response to guarantee India’s own food security. He said the IMF was not justified in criticizing India’s market controls when Western nations continued to use vast quantities of grain for making biofuels.

“Despite the threat from the IMF, I think the Indian government has taken the right decision. India’s own domestic food security is of paramount importance,” Sharma told Arab News.

“Regarding the shortfall in the global supply, why don’t you ask America and Europe to cut down on ethanol production? The former consumes 90 million tons of food grain for its ethanol production, while the EU uses 12 million tons. They should stop it.

“India has to take care of its own food security. Imagine, 3 million people died in the 1943 Bengal famine because food was diverted. I think India has taken the right decision.”

For now, anecdotal evidence suggests few consumers in Arab countries are concerned about the impact of India’s export ban.

“We in Jordan consume basmati rice and not the white non-basmati rice that was included in the ban,” Jamal Amr, foodstuff representative at Jordan’s Chamber of Commerce, told Arab News.

He said Jordan bought most of its rice from the US, the EU, East Asian countries, Uruguay and Argentina.

“I am not stockpiling rice and I am not planning to. Things look normal to me,” Emirati housewife Umm Mohamed, a resident of Dubai, told Arab News. “My family and the domestic helpers all eat rice as a main staple.”




A farmer harvests at a rice paddy on the outskirts of Srinagar, India. (AFP)

The picture is the same in Saudi Arabia. “Rice is the main source of food in Saudi Arabia,” retired engineer Abu Akram said.

“In every main meal, we have to put basmati rice on the table. Saudi families usually store rice in quantities that can last for a month or two.”

He said he was not concerned about a possible price rise, but was thinking of asking his sons to buy extra rice, “just in case.”

In the era of globalization, involving free movement of goods, people and capital, the shopping habits of rice eaters in the Arab world are not immune to fluctuations in the fortunes of Indian agriculture.

India’s farmers typically start planting rice and other water-intensive crops from June 1 to coincide with the annual monsoon season. However, the country received 10 percent less rain than the average for June, with that figure rising to 60 percent in some states.

Although the monsoon rains have now arrived, the delay held up the planting of summer crops, a setback that experts believe prompted the Indian government to curb exports of rice.

Just a few days after the restriction was imposed, the UAE announced its own four-month ban on the export and re-import of all rice varieties, starting from July 28.

The UAE imports almost 90 percent of its food, making it especially vulnerable to fluctuations in global prices. According to Reuters data, the UAE was among the top 10 importers of non-basmati rice from India in 2020, buying almost 346,000 tons.

Saudi Arabia, Iraq, Iran, Yemen, Kuwait, Oman, Qatar, the UK and the US also feature among the top 10 importers.




A farmer spreads unpolished rice to dry along a highway in Toopran Mandal in the Medak district, some 55 km from Hyderabad on November 11, 2021. (AFP)

Large quantities of rice imported by the UAE are later exported after packaging in the free zones. The ban on re-importing will therefore affect countries that buy packaged rice from the UAE.

Other countries that are likely to feel the squeeze of India’s export ban are African importers such as Benin. But even big economies like China will be affected, despite it being a major rice producer in its own right.

Arab countries that are likely to suffer the most from India’s export ban are Egypt, Algeria and Sudan, all of which already face economic turbulence and the effects of rising wheat prices. In Sudan’s case, a deadly feud between two generals since April 15 has compounded the woes of a population ravaged by hunger and malnutrition.

Unsurprisingly, some observers believe India made the wrong call, undermining its carefully cultivated image as a reliable trade partner and aspiring leader of the Global South.

“I feel the ban on the export of rice is a knee-jerk reaction to control prices in the domestic market with elections in view,” said Gokul Patnaik, former chairman of India’s government-affiliated Agricultural and Processed Food Products Export Development Authority.

“But it gives a very bad name to India which is emerging as an agri-exporter. Earlier, India was a net importer and of late it had earned a good reputation as an exporter. Countries which are buying from India will definitely feel this kind of reaction. To switch on and off is not good if one is to be a consistent exporter.”

He added: “What the government could have done was to control the taxes. It could have increased export tax. If you are going to be in international trade, you should always be open to import and export. You should not ban.

“Importing countries expect you to be consistent and you should not only be a fair-weather friend. Export-import is a question of trust. If you lose trust, people don’t want to continue.”




The ban on exports of non-basmati white rice imposed on July 20 by India. (AFP)

It is not just rice that has become costlier in India in recent weeks. The prices of tomatoes and other staples have also risen following the late arrival of the monsoon rains in some parts of the country and unexpectedly heavy downpours in others.

With heavy rains damaging standing crops in some regions, predictions now are of poor harvests and even higher prices of farm produce. Public anger over food inflation could become a clear disadvantage for the government, which faces several regional elections this year in the run-up to the national vote.

Brajesh Jha, a professor at the Institute of Economic Growth in Delhi, takes the view that India is ill equipped to be a major exporter, but believes the ban is largely tied to the general election next year, which takes primacy over international relations.

“India is an exporter of food grains. (But) the kind of arable lands and the population that is dependent on foodgrains (means) India cannot be an exporter,” he told Arab News.

“Rice is exported from those areas which are semi-arid. The way the population is increasing, India needs lots of food grains.

“No doubt India’s standing among the community of nations will get a beating with this kind of decision, but the election is way more important (for the government) than the impression people form about it.”

Other experts say the Indian government should have implemented alternative policies that would have avoided compounding the global food crisis while at the same time stabilizing domestic prices.

“India could have used this opportunity to be a global leader that is helping against a potential food crisis,” Anupam Manur, an international trade economist at the Takshashila Institution in Bengaluru, told Arab News.

“Instead, imposing a ban on an essential commodity at such a time will weaken India’s arguments against other countries weaponizing supply chains by imposing export controls on semiconductors, rare earth elements or medical application programming interface.”




Workers transplant rice paddy in West Bengal, India. (Getty Images)

He added: “If it truly wants to mitigate a domestic price rise, the government can open up the warehouses which have more than adequate rice stocks.

“India might not bend to international pressure, but if domestic production increases, it might yet make a grand gesture of relaxing the ban.”

While such a gesture would ease global concerns, El-Zubi says that many Arab countries, including Egypt, Iraq, Syria and Jordan, are in no position to meet their own demand for wheat and rice as they lack the necessary water resources.

“Jordan produces only 3 percent of the wheat it needs,” he told Arab News.

According to him, Arab countries with fragile economies face serious challenges from food shortages, so they should expand the sources from which they buy strategic food staples, diversify payment methods and broaden their food supply chains and routes.


Lebanon aims to lure back wealthy Gulf tourists to jumpstart its war-torn economy

Updated 14 sec ago
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Lebanon aims to lure back wealthy Gulf tourists to jumpstart its war-torn economy

BEIRUT: Fireworks lit up the night sky over Beirut’s famous St. Georges Hotel as hit songs from the 1960s and 70s filled the air in a courtyard overlooking the Mediterranean Sea.
The retro-themed event was hosted last month by Lebanon’s Tourism Ministry to promote the upcoming summer season and perhaps recapture some of the good vibes from an era viewed as a golden one for the country. In the years before a civil war began in 1975, Lebanon was the go-to destination for wealthy tourists from neighboring Gulf countries seeking beaches in summer, snow-capped mountains in winter and urban nightlife year-round.
In the decade after the war, tourists from Gulf countries – and crucially, Saudi Arabia – came back, and so did Lebanon’s economy. But by the early 2000s, as the Iran-backed militant group Hezbollah gained power, Lebanon’s relations with Gulf countries began to sour. Tourism gradually dried up, starving its economy of billions of dollars in annual spending.
Now, after last year’s bruising war with Israel, Hezbollah is much weaker and Lebanon’s new political leaders sense an opportunity to revitalize the economy once again with help from wealthy neighbors. They aim to disarm Hezbollah and rekindle ties with Saudi Arabia and other Gulf countries, which in recent years have prohibited their citizens from visiting Lebanon or importing its products.
“Tourism is a big catalyst, and so it’s very important that the bans get lifted,” said Laura Khazen Lahoud, the country’s tourism minister.
On the highway leading to the Beirut airport, once-ubiquitous banners touting Hezbollah’s leadership have been replaced with commercial billboards and posters that read “a new era for Lebanon.” In the center of Beirut, and especially in neighborhoods that hope to attract tourists, political posters are coming down, and police and army patrols are on the rise.
There are signs of thawing relations with some Gulf neighbors. The United Arab Emirates and Kuwait have lifted yearslong travel bans.
All eyes are now on Saudi Arabia, a regional political and economic powerhouse, to see if it will follow suit, according to Lahoud and other Lebanese officials. A key sticking point is security, these officials say. Although a ceasefire with Israel has been in place since November, near-daily airstrikes have continued in southern and eastern Lebanon, where Hezbollah over the years had built its political base and powerful military arsenal.
Tourism as a diplomatic and economic bridge
As vital as tourism is — it accounted for almost 20 percent of Lebanon’s economy before it tanked in 2019 — the country’s leaders say it is just one piece of a larger puzzle they are trying to put back together.
Lebanon’s agricultural and industrial sectors are in shambles, suffering a major blow in 2021, when Saudi Arabia banned their exports after accusing Hezbollah of smuggling drugs into Riyadh. Years of economic dysfunction have left the country’s once-thriving middle class in a state of desperation.
The World Bank says poverty nearly tripled in Lebanon over the past decade, affecting close to half its population of nearly 6 million. To make matters worse, inflation is soaring, with the Lebanese pound losing 90 percent of its value, and many families lost their savings when banks collapsed.
Tourism is seen by Lebanon’s leaders as the best way to kickstart the reconciliation needed with Gulf countries — and only then can they move on to exports and other economic growth opportunities.
“It’s the thing that makes most sense, because that’s all Lebanon can sell now,” said Sami Zoughaib, research manager at The Policy Initiative, a Beirut-based think tank.
With summer still weeks away, flights to Lebanon are already packed with expats and locals from countries that overturned their travel bans, and hotels say bookings have been brisk.
At the event hosted last month by the tourism ministry, the owner of the St. Georges Hotel, Fady El-Khoury, beamed. The hotel, owned by his father in its heyday, has acutely felt Lebanon’s ups and downs over the decades, closing and reopening multiple times because of wars. “I have a feeling that the country is coming back after 50 years,” he said.
On a recent weekend, as people crammed the beaches of the northern city of Batroun, and jet skis whizzed along the Mediterranean, local business people sounded optimistic that the country was on the right path.
“We are happy, and everyone here is happy,” said Jad Nasr, co-owner of a private beach club. “After years of being boycotted by the Arabs and our brothers in the Gulf, we expect this year for us to always be full.”
Still, tourism is not a panacea for Lebanon’s economy, which for decades has suffered from rampant corruption and waste.
Lebanon has been in talks with the International Monetary Fund for years over a recovery plan that would include billions in loans and require the country to combat corruption, restructure its banks, and bring improvements to a range of public services, including electricity and water.
Without those and other reforms, Lebanon’s wealthy neighbors will lack confidence to invest there, experts said. A tourism boom alone would serve as a “morphine shot that would only temporarily ease the pain” rather than stop the deepening poverty in Lebanon, Zoughaib said.
The tourism minister, Lahoud, agreed, saying a long-term process has only just begun.
“But we’re talking about subjects we never talked about before,” she said. “And I think the whole country has realized that war doesn’t serve anyone, and that we really need our economy to be back and flourish again.”

US mulls giving millions to controversial Gaza aid foundation, sources say

Updated 07 June 2025
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US mulls giving millions to controversial Gaza aid foundation, sources say

  • The plan has met resistance from some US officials concerned with the deadly shootings of Palestinians near aid distribution sites and the competence of the GHF, the two sources said

WASHINGTON: The State Department is weighing giving $500 million to the new foundation providing aid to war-shattered Gaza, according to two knowledgeable sources and two former US officials, a move that would involve the US more deeply in a controversial aid effort that has been beset by violence and chaos.
The sources and former US officials, all of whom requested anonymity because of the sensitivity of the matter, said that money for Gaza Humanitarian Foundation (GHF) would come from the US Agency for International Development (USAID), which is being folded into the US State Department.
The plan has met resistance from some US officials concerned with the deadly shootings of Palestinians near aid distribution sites and the competence of the GHF, the two sources said.
The GHF, which has been fiercely criticized by humanitarian organizations, including the United Nations, for an alleged lack of neutrality, began distributing aid last week amid warnings that most of Gaza’s 2.3 million population is at risk of famine after an 11-week Israeli aid blockade, which was lifted on May 19 when limited deliveries were allowed to resume.
The foundation has seen senior personnel quit and had to pause handouts twice this week after crowds overwhelmed its distribution hubs.
The State Department and GHF did not immediately respond to requests for comment.
Reuters has been unable to establish who is currently funding the GHF operations, which began in Gaza last week. The GHF uses private US security and logistics companies to transport aid into Gaza for distribution at so-called secure distribution sites.
On Thursday, Reuters reported that a Chicago-based private equity firm, McNally Capital, has an “economic interest” in the for-profit US contractor overseeing the logistics and security of GHF’s aid distribution hubs in the enclave.
While US President Donald Trump’s administration and Israel say they don’t finance the GHF operation, both have been pressing the United Nations and international aid groups to work with it.
The US and Israel argue that aid distributed by a long-established UN aid network was diverted to Hamas. Hamas has denied that.
USAID has been all but dismantled. Some 80 percent of its programs have been canceled and its staff face termination as part of President Donald Trump’s drive to align US foreign policy with his “America First” agenda.
One source with knowledge of the matter and one former senior official said the proposal to give the $500 million to GHF has been championed by acting deputy USAID Administrator Ken Jackson, who has helped oversee the agency’s dismemberment.
The source said that Israel requested the funds to underwrite GHF’s operations for 180 days.
The Israeli government did not immediately respond to a request for comment.
The two sources said that some US officials have concerns with the plan because of the overcrowding that has affected the aid distribution hubs run by GHF’s contractor, and violence nearby.
Those officials also want well-established non-governmental organizations experienced in running aid operations in Gaza and elsewhere to be involved in the operation if the State Department approves the funds for GHF, a position that Israel likely will oppose, the sources said.
Gaza hospital officials have said more than 80 people had been shot dead and hundreds wounded near GHF’s distribution points between June 1-3.
Since launching its operation, the GHF has opened three hubs, but over the past two days, only two of them have been functioning.
Witnesses blamed Israeli soldiers for the killings. The Israeli military said it fired warning shots on two days, while on Tuesday it said soldiers had fired at Palestinian “suspects” advancing toward their positions.


Activist boat says rescues migrants en route to Gaza

Updated 06 June 2025
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Activist boat says rescues migrants en route to Gaza

  • The Madleen has “a 12-member crew of peaceful activists” headed for Gaza “with the aim of breaking the blockade of Palestine by the state of Israel,” the March to Gaza Greece group said

ATHENS: A vessel organized by an international activist coalition to deliver humanitarian aid to Gaza has rescued several migrants from the sea near Crete, a support group in Greece said on Friday.
The Madleen, launched by the Freedom Flotilla Coalition, said it had received a distress signal from a boat in the Mediterranean, forcing it to change course off the coast of Crete.
The Madleen has “a 12-member crew of peaceful activists” headed for Gaza “with the aim of breaking the blockade of Palestine by the state of Israel,” the March to Gaza Greece group said.
“Upon arrival (at the scene), it discovered that the boat was sinking with approximately 30-35 people aboard.”
At that point, the Madleen was approached by a ship that initially identified itself as Egyptian.
“The activists aboard the Madleen quickly realized that this was a false identification and that the ship was, in fact, a Libyan coast guard vessel,” they said.
“Libya is not considered a safe country and for this reason some of the refugees jumped into the sea to avoid being returned there.
“The Madleen rescued four Sudanese individuals who had jumped into the water and brought them aboard.”
After several hours of calls for assistance, a Frontex vessel eventually picked up the rescued individuals, the group said, referring to the European Union’s border and coast guard agency.
The Madleen sailed from Sicily on Sunday.
Those on board include climate activist Greta Thunberg.
The Freedom Flotilla Coalition, launched in 2010, is a non-violent international movement supporting Palestinians.
It combines humanitarian aid with political protest against the Israeli blockade of Gaza.
Israel has come under increasing international criticism over the critical humanitarian situation in the occupied Palestinian territory.
It blocked all aid into Gaza on March 2. The United Nations warned on May 30 that the entire population of more than two million was at risk of famine.
Fighters from Palestinian group Hamas launched an attack on Israel on October 7, 2023.
A total of 1,218 people died, mostly civilians, according to an AFP tally based on official Israeli figures.
The militants abducted 251 hostages, 55 of whom remain in Gaza, including 32 the Israeli military says are dead.
Since October 2023, Israel’s retaliatory war on Hamas-run Gaza has killed 54,677 people there, mostly civilians, according to the Gaza health ministry.
The United Nations deems the health ministry figures to be reliable.
The International Criminal Court has issued arrest warrants against Israeli Prime Minister Benjamin Netanyahu and former Israeli defense minister Yoav Gallant for alleged war crimes and crimes against humanity in Gaza.
 

 


Iraq frees Australian, Egyptian engineers after four years, but keeps travel ban

Iraqi police stand guard in Baghdad. (AFP file photo)
Updated 06 June 2025
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Iraq frees Australian, Egyptian engineers after four years, but keeps travel ban

  • Both men were sentenced to five years in prison and fined $12 million, the working group said

BAGHDAD: Iraq has released an Australian mechanical engineer and his Egyptian colleague who were detained for more than four years over a dispute with the central bank, authorities said Friday, though the two remain barred from leaving the country.
Robert Pether and Khalid Radwan were working for an engineering company contracted to oversee the construction of the bank’s new Baghdad headquarters, according to a United Nations report, when they were arrested in April 2021.
A report from a working group for the UN Human Rights Council said the arrests stemmed from a contractual dispute over “alleged failure to execute certain payments.”
Both men were sentenced to five years in prison and fined $12 million, the working group said.
A security official, speaking on condition of anonymity, told AFP that Pether, in his fifties, was released “due to his poor health.”
Australian media have previously reported that the family suspected Pether had developed lung cancer in prison and that he had undergone surgery for skin cancer.
A second Iraqi official confirmed the release of Radwan, adding that he was not allowed to leave the country until a “final decision” was made regarding his case.
Australia’s ABC broadcaster quoted the country’s foreign minister, Penny Wong, as welcoming the release and saying the Australian government had raised the issue with Iraqi authorities more than 200 times.
Simon Harris, foreign minister for Ireland, where Pether’s family lives, posted on X: “This evening, I have been informed of the release on bail of Robert Pether, whose imprisonment in Iraq has been a case of great concern.
“This is very welcome news in what has been a long and distressing saga for Robert’s wife, three children and his wider family and friends.”
Speaking to Irish national broadcaster RTE, Pether’s wife, Desree Pether, said her husband was “not well at all” and “really needs to just come home so he can get the proper medical care he needs.”
“He’s completely unrecognizable. It’s a shock to the system to see how far he has declined,” she said.
 

 


Syrian leader makes first visit to cradle of country’s uprising

Updated 06 June 2025
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Syrian leader makes first visit to cradle of country’s uprising

  • SANA published footage showing a cheering crowd greeting Sharaa
  • Sharaa and Interior Minister Anas Khattab visited Daraa’s historic Omari mosque during the trip

DAMASCUS: Syrian Arab Republic’s interim President Ahmed Al-Sharaa on Friday visited the southern city of Daraa, the cradle of the country’s uprising, for the first time since ousting longtime ruler Bashar Assad almost six months ago.

State news agency SANA published footage showing a cheering crowd greeting Sharaa, who was seen waving and shaking hands with people during the visit, which came on the Muslim holiday of Eid Al-Adha.

Sharaa and Interior Minister Anas Khattab visited Daraa’s historic Omari mosque during the trip, the presidency said in a statement, releasing images of the visit showing the leader among the crowd.

SANA also said he met with local civil and military officials, as well as a delegation from the Christian minority.

Provincial governor Anwar Al-Zoabi said in a statement that the visit was “an important milestone in the course of national recovery.”

In 2011, young boys who had scrawled graffiti against Assad were detained in Daraa, sparking nationwide protests.

After the war erupted following the brutal repression of protests, rebels seized control of Daraa and hung on until 2018, when the city returned to Assad under a deal mediated by Russia that allowed former fighters to keep their light weapons.

On December 6, as Sharaa’s Islamist group Hayat Tahrir Al-Sham (HTS) led a lightning offensive on Damascus from the country’s northwest, a coalition of armed groups from Daraa province was formed to help oust Assad, who was toppled two days later.

The province was plagued by unrest in recent years.