Likelihood of Extension for Duty Drawback on Basmati Rice Exports from Pakistan

18-Jun-2026 12:40 PM

New Delhi: The Pakistan government is planning to extend the deadline for duty drawback benefits on Basmati rice exports, a move that has raised concerns among Indian exporters. It is worth noting that Pakistan's Ministry of Commerce had previously issued an order announcing the provision of refunds for local duties and levies collected from the rice sector, with the scheme valid until June 30, 2026. Indications suggest that an announcement extending this deadline could be made even before the current period expires.

This extension would assist Pakistani exporters in maintaining competitive price points for their Basmati rice exports. Consequently, Indian exporters could face increased challenges, raising the risk of a decline in their export earnings.

While Indian Basmati rice exports to Gulf nations are expected to perform well, the continuation of the duty drawback scheme in Pakistan could pose difficulties for India. Notably, the duty drawback scheme has already led to some improvement in Pakistani Basmati rice exports.

If Pakistani exporters lower their prices to boost exports, international market rates could drop, forcing Indian exporters to reduce their prices as well. This would naturally result in a decline in export earnings.

The Pakistani Ministry of Commerce's order stipulated that exporters shipping long-grain aromatic Basmati rice at $750 per tonne or higher could claim a refund of 9 percent of the total Free-on-Board (FOB) value, whereas the duty drawback rate was set at 3 percent for exports priced below $750 per tonne.