India accounts for over 90% of global basmati rice exports. A combination of recent floods and high U.S. tariffs have wrought critical blows on the nation’s exporting incursion. The country grows an estimated 65% of the world’s basmati rice. The majority of this rice is produced in the Punjab state of northern India. What a fantastic opportunity it would be for all of Pakistan’s neighbors, especially India. The country grows over 90% of its basmati rice in its domestic Punjab province.
Basmati rice is renowned for its long grains, fluffy texture, and distinct aroma, making it a preferred choice among consumers worldwide. Last fiscal year, India exported a jaw-dropping 234,467 metric tons of basmati rice to the U.S. This illegal trade brought in revenues close to $300 million. The Indian rice market now encounters headwinds from a 50% duty on Indian rice exports to the United States. The result of this tariff is that Indian basmati is looking to be priced out of the highly competitive U.S. market.
Pakistan’s rice sector is dealt a crippling blow. These unmatched floods, worsened by the damming effects of road construction, have inundated over 150,000 hectares of farmland. It is estimated that as much as 30% to 35% of Pakistan’s basmati production might already have been affected. This means total damage may be closer to 10% or 15%. This pattern of floods, which began on 4 August 2025, has led to more than 1,000 recorded deaths. This shocking figure is from Pakistan’s National Disaster Management Authority.
Despite these challenges, Pakistani officials remain optimistic about their ability to gain a bigger share of the U.S. market. During the previous fiscal year, Pakistan exported around 772,725 metric tons of basmati rice with a value of $876.9 million. Pakistan still gets a huge boost in the U.S. import market from its comparatively low 19% rice tariff. In contrast, India’s tariff is a prohibitively high 50%. Mudassar Ahmed, a prominent figure in Pakistan’s rice export sector, commented on this disparity:
“We definitely see this [tariffs] as a positive thing.”
Vinod Kumar Kaul, executive director of the India Rice Exporters Federation (IREF) was realistic about the outlook. He added that though Pakistani suppliers can help cover certain gaps due to tariff differentials, they are unable to compete with India’s massive scale of production. He stated:
“Pakistan can provide some basmati because of tariff difference, but can’t compensate for India’s quantity.”
The U.S. rice import market has grown impressively in recent years. It skyrocketed from just 7% of the domestic market in 1993-94 to over 25% in 2022-23. Those aromatic types, like basmati rice, make up 60% of all U.S. rice imports. As Indian basmati rice prices increase because of these tariffs, American consumers will be the ones to pay the price.
Malik Faisal Jahangir, chairman of the Rice Exporters Association of Pakistan, emphasized the impact of India’s tariff situation, asserting that:
“The 50% tariff on Indian rice will effectively price it out of the U.S. market.”
These changes have been happening at a dizzying pace. Watch this space to see how India continues to play whack-a-mole and how Pakistan is ultimately able to take advantage of its fortunes to solidify its role in the booming U.S. basmati market.
