NEw Delhi, Feb 3 - India is likely to again lower the floor price for basmati rice exports to help traders who are losing market share to rival Pakistan, Commerce Secretary G.K. Pillai told reporters on Monday.
Last month, the government reduced the minimum price at which exports are allowed to $1,100 per tonne from $1,200 per tonne, but Indian exporters, who have faced defaults from buyers as prices fell, said the cut was inadequate.
"When basmati rice exports are free, high export price doesn't make sense. There is a demand to lower the export price and there is room for that," Pillai said.
"Pakistan is selling at much lower price, making us uncompetitive," he said.
Over the last two years India has taken several measures to secure domestic grain supply and calm inflation.
It had fixed a minimum export price for basmati rice, banned shipments of wheat and removed the import tax on crude vegetable oils.
Falling prices have encouraged the government to gradually relax some of the restrictions, but analysts say a more liberal trade regime may be allowed only after general elections likely in April and May.