Pak-backed firm slaps legal notice on India over basmati

The row over basmati rice varieties has boiled over with the Pakistan government-backed Trading Corporation of Pakistan serving a legal notice to the government of India. Officials told FE, the Pakistani company has claimed Indian exporters were not eligible to use the ?Super? variety of basmati and claim duty free benefit given by the European Union.

Pakistan supported the company when the matter came up for discussion during the Economic and Commercial Cooperation meeting between the two countries on Tuesday, the officials said. Pakistan insisted that export of the ?Super? variety from India was illegal since it was a hybrid of basmati developed by their scientists.

But India has prima facie rejected this claim. Commerce ministry officials said both the countries had signed an agreement on agriculture at the WTO in 2004. Article 28 of the pact states that the EU would grant duty-free benefits to basmati of both ?Pusa? and ?Super? varieties exported from both the countries.

The officials said Pakistan signed this agreement on August 11, 2004 while Indian signed it on August 20, meaning that it had agreed to the terms and conditions of the agreement before India.

After farmers in Punjab started growing the ?Super? variety, India had in an official notification said this variety could be exported from India too as per the terms of the Export (Inspection Control) Act.

India?s basmati rice exports to Europe rose from 1.82 lakh tonne in September 2002-August 2003 to 2.20 lakh tonne in September 2005-August 2006 while Pakistan?s plummeted from 95,000 tonne to just 53,000 tonne during the same period. The reason being, unlike Pakistan, India?s exports maintained superior quality and were free from aflatoxin problem, the officials said.

Following the legal notice, the commerce ministry has called for a meeting on August 3. The issue is urgent since Pakistan has even threatened to take up the issue with the EU soon.

Pakistan is believed to be dragging its feet since it has lost out to India in the basmati rice segment in the European market.