U.S. tariff on Indian Basmati opens door for Pakistan’s rice export surge

Pakistani rice exporters are poised to gain a significant foothold in the U.S. market following Washington’s decision to impose a 50% tariff on Indian basmati rice.

The move is expected to boost Pakistan’s share in a lucrative segment where demand for aromatic varieties is steadily rising.

Pakistan’s basmati rice exports have shown consistent growth. In FY2024, the country exported 772,725 tonnes, earning $876.9 million, compared to 595,120 tonnes worth $650.4 million in FY2023. The average export price also climbed from $1,092 to $1,134 per tonne.

The U.S. has become a prime destination for Pakistani basmati, accounting for 24% of total exports between November 2023 and October 2024, equal to 1,519 shipments.

Italy ranked second with 14% (908 shipments), followed by the U.K. with 11% (716 shipments). Together, these three markets consume almost half of Pakistan’s total basmati exports.

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Pakistan currently sells basmati rice to more than 110 countries, with other key buyers including Australia, Saudi Arabia, the UAE, Canada, the Netherlands, and Germany.

According to U.S. Department of Agriculture (USDA) data, the share of imports in U.S. rice consumption has grown from 7% in 1993/94 to over 25% in 2022/23. More than 60% of these imports are aromatic varieties from Asia, particularly Thailand’s jasmine and basmati from India and Pakistan.

While the U.S. produces some aromatic rice domestically, it lacks the distinct aroma and taste of Asian varieties, and USDA forecasts continued growth in aromatic rice imports in the coming years.