Budget 2026: Rice exporters seek support to offset impact of rising cost, environmental stress

India's agricultural sector, particularly its rice industry, stands at a critical juncture, navigating the dual challenges of global competitiveness and environmental sustainability. The recent appeal by rice exporters for government support in Budget 2026 underscores the immense pressure faced by a sector vital for both domestic livelihoods and global food security. India has historically been a dominant force in the global rice market, emerging as the world's largest exporter, accounting for over 40% of the global trade. This position was largely cemented by the success of the Green Revolution in the 1960s and 70s, which transformed India from a food-deficient nation to a surplus producer, capable of feeding its vast population and exporting its excess. Rice, being a staple food for over half of the world's population, makes India's role indispensable.

The current plea from exporters highlights two primary concerns: escalating production costs and increasing environmental stress. Production costs, driven by rising prices of fertilizers, pesticides, labor wages, and energy (diesel for irrigation and farm machinery), are eroding profit margins for farmers and exporters alike. Simultaneously, environmental stress, manifesting as erratic monsoon patterns, prolonged droughts, floods, and increased pest infestations due to climate change, directly impacts yield and quality. The industry's call for policy support in Budget 2026 aims to mitigate these pressures, ensuring that Indian rice remains competitive against rivals like Thailand and Vietnam, while also fostering sustainable farming practices for long-term viability.

Key stakeholders in this scenario include the **rice exporters** themselves, often represented by bodies like the All India Rice Exporters' Association (AIREA), who advocate for policies that maintain their market share and profitability. **Farmers**, the backbone of the agricultural economy, are directly impacted by input costs and climate variability; their livelihoods depend on stable prices and robust yields. The **Government of India**, through ministries such as Finance, Agriculture & Farmers' Welfare, and Commerce & Industry, plays a pivotal role in formulating policies, allocating subsidies, and negotiating trade agreements. Global consumers and importing nations are also stakeholders, relying on India's consistent supply to maintain their food security, especially for Basmati and non-Basmati varieties.

This issue holds immense significance for India. Economically, rice exports contribute substantially to India's foreign exchange earnings, helping to bridge the trade deficit. A robust export sector creates employment opportunities across the value chain, from farming and milling to logistics and trade. Socially, the rice sector supports millions of rural households, making stable incomes and sustainable practices crucial for poverty alleviation and rural development. Geopolitically, India's reliability as a food supplier enhances its standing on the global stage. Instances like the 2023 ban on the export of non-Basmati white rice, implemented to control domestic prices, demonstrated the significant global impact of India's policy decisions on international food markets and prices.

The historical context reveals a journey from food scarcity to self-sufficiency and then to export dominance. Government interventions, including Minimum Support Price (MSP) mechanisms, subsidies on inputs, and public distribution systems (PDS), have shaped this trajectory. While these policies have ensured food security, they have also led to challenges like water depletion in rice-growing regions (e.g., Punjab, Haryana) and a focus on water-intensive varieties. The government's **Agriculture Export Policy 2018** aimed to diversify and boost agricultural exports, recognizing the sector's potential to double farmer incomes. However, the current challenges necessitate a re-evaluation of strategies to align with climate realities and global trade dynamics.

Looking ahead, the future implications are profound. Budget 2026 could introduce targeted subsidies for climate-resilient rice varieties, promote water-saving irrigation techniques (like Direct Seeded Rice - DSR), or offer incentives for adopting sustainable farming practices. Investment in agricultural research and development (R&D) for high-yielding, pest-resistant, and climate-adaptive strains will be crucial. The government might also explore new export promotion schemes to enhance market access and branding for Indian rice. Balancing domestic food security concerns (often addressed by the **National Food Security Act, 2013**) with export ambitions will remain a tightrope walk. India's commitment to international agreements, particularly under the **World Trade Organization (WTO)**, regarding agricultural subsidies and trade practices, will also influence policy formulation.

Constitutionally, agriculture falls primarily under the **State List (Entry 14 of List II, Seventh Schedule)**, while economic and social planning is in the **Concurrent List (Entry 20 of List III)**. This necessitates cooperation between central and state governments. The Directive Principles of State Policy, particularly **Article 38** (State to secure a social order for the promotion of welfare of the people) and **Article 48** (Organization of agriculture and animal husbandry), guide the state in formulating policies to support farmers and ensure agricultural prosperity. Future policies will need to align with these principles, fostering a sustainable and competitive rice sector that continues to feed India and the world.