Bangladesh will export 50,000 tonnes of boiled rice to Sri Lanka as the Cabinet Committee on Economic Affairs approved Thursday a proposal in this regard.
"We decided to export 50,000 tonnes of boiled rice to Sri Lanka. Presently, we have sufficient stock of food. It will be government-to-government (G-to -G) arrangement," Finance Minister AMA Muhith told the media after the meeting at the Cabinet Division on the day.
"They asked us for exporting rice. We have friendly relations with Sri Lanka. So we decided to export rice to Sri Lanka," he said.
He said that the two countries would finalise the price of rice per tonne soon.
Asked whether the export decision would bring any negative impact on internal market prices of rice, the Finance Minister said, "I think it will cause no problem".
Once the shipment starts, then the country will emerge as a coarse rice exporter, as no rice export, other than aromatic rice, has so far taken place from the country.
Though Bangladesh is going to export boiled rice (coarse variety), the country still imports a significant quantity of rice every year to meet its growing demand.
The Ministry of Commerce (MoC), through a statutory regulatory order (SRO) in June 2014, imposed a ban on export of all varieties of rice, except the aromatic ones, until June, 2015.
The objective of the restriction was to help keep rice prices stable through ensuring its adequate supply in the domestic market.
Earlier the Ministry of Food proposed to the Cabinet Committee on Economic Affairs, seeking exemption from the existing restriction on rice export following a request from the Sri Lankan government.
The High Commission of Sri Lanka in Dhaka in a letter to the Ministry of Foreign Affairs (MoFA) expressed the country's interest to import rice from Bangladesh on an emergency basis. And the MoFA conveyed the matter to the Food Ministry for taking necessary steps. The Food Ministry took the decision of exporting 50,000 tonnes of coarse rice to Sri Lanka, considering the government's overall food stock situation and possible impact of the export on local rice market.
The total food grains stock in the country is now 1.49 million tonnes. Out of the quantity, 1.14 million tonnes are rice while 0.34 million tonnes wheat and 10,098 tonnes paddy, according to the Directorate of Food.
In its proposal, the Food Ministry quoted US$ 493 as price for a tonne of boiled rice. The rate includes shipment, insurance and transportation costs.
The officials said an increased domestic output of rice coupled with adequate official stock encouraged the government to respond to Sri Lanka's rice import offer.
According to the Bangladesh Bureau of Statistics (BBS), the country's rice production was about 34.36 million tonnes in the fiscal year 2013-14, nearly 0.6 million tonnes higher than that of the previous fiscal.
Despite having the production growth, around 0.5 million tonnes of rice were imported by the country's private sector in the last fiscal.
Meanwhile, local rice traders have ruled out any negative impact of the proposed rice export under the G-to-G initiative amid better supply of the staple food, both at the private and the government levels.
"The stock of rice in the warehouses, of both public and private sectors, is satisfactory. So, the proposed rice export will not create any adverse impact on the domestic rice market," Sarwar Alam Kazol, joint secretary of the Bangladesh Auto Major and Husking Mill Owners Association, told the FE.
He also expressed the hope that in future the private sector will also be allowed to export boiled rice.
The Cabinet Committee on Economic Affairs also approved the project proposal for building the Paira Sea Port under the G-to- G arrangement.
The Cabinet Committee on Purchase, also chaired by the Finance Minister on the same day, approved purchase of 15 million pieces cut-size B-toil sacks under direct procurement method (DPM) from the Bangladesh Jute Mills Corporation (BJMC).
It also asked for re-tender for purchase proposal for capital dredging work by cutter suction dredger for improving navigability of Gaglagor-Mohongonj river route by the Bangladesh Inland Water Transport Authority (BIWTA) under the Ministry of Shipping.
It also approved the proposal for Upgradation of Hazrat Shahjalal International Airport and import of 0.1 million tonnes of granular urea fertilizer.
