Budget 2026: Rice Exporters Seek Tax Relief, Credit And Freight Support

The Indian Rice Exporters Federation (IREF) has urged the Union Finance Ministry to introduce an overall fiscal package in Budget 2026, according to PTI. This will include an interest subsidy of 4% for export loans and extensive logistics assistance to maintain India's 40% share in the global rice trade.

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Fiscal and Logistics Arrangements

To address rising costs of inputs and maintain competitiveness of export prices vis-à-vis other ASEAN countries, IREF suggests an interest subvention of 4% on export loans, with emphasis on MSMEs. The idea is to minimise working capital costs of exporters, many of whom operate on slender margins in an unpredictable global environment.
On the other hand, IREF is claiming a 3% refunding fee to defray the cost of freight charges relating to transportation of grain from production sites to ports and Inland Container Depots. India’s high logistics costs have historically eroded its FOB value in respect of its quality rice; this will mitigate this situation.

Regulatory and Tax Relief 

One crucial element of the memo is advocating that there should be an occasional waiver of retrospective demands for duties. This follows because when the 20% export duty was imposed on some types of rice, there were discrepancies in the duty calculation figures provided by the lower-level administrative bodies, and as such, numerous notifications pertaining to taxation were sent to the exporters. According to IREF, such errors were made due to genuine uncertainties and not evasion, and thus, they should be waived to save all involved individuals the trouble of going to court.
The federation has also called for speedy distribution and appropriate structuring of benefits offered by RoDTEP (Remission of Duties and Taxes on Exported Products) to date. This is because they feel that the rates are supposed to accurately include embedded taxes to keep exports feasible.

Sustainability and Value Addition 

Noting the high rate of groundwater ablation in key paddy areas, proposals in the budget propose tax incentives related to resource-efficient agriculture technology use. The federation has called for fiscal incentives for use of Alternate Wetting and Drying (AWD), Direct Seeded Rice (DSR), and Laser Land Leveling technologies by farmers and millers.
Besides this, the industry body also plans a strategy to reduce dependence on the government’s Minimum Support Price (MSP) scheme by encouraging farmers to focus on high-value crops. The strategy calls for support to increase the acreage under high-quality Basmati, GI-tagged, and organic varieties as they can generate greater revenues to farmers.