The Ministry of Industry and Trade is drafting a decree on rice trade to limit the import of low-quality grain.
The volume of low-grade rice imported from India has surged due to low vietnaprices and zero import tax under the ASEAN-India Free Trade Area, potentially affecting Vietnam’s own rice production and food security.
Last year Vietnam imported a million tons of rice from various countries, including over 72% from India, according to ministry statistics.
The low-quality grain, including broken, imported from India is mainly used to make noodles, cakes, animal feed, beer, and liquor.
Vietnam, which exports 6-6.5 million tons of mainly high-grade rice annually to 156 countries and territories, had imported only around 5,000 tons of Indian rice in 2019, according to the ministry.
Pham Thai Binh, general director of Trung An Hi-tech Farming Joint Stock Company, said “Vietnamese farmers’ income is still very precarious. Instead of importing low-quality rice, enterprises can buy rice in the domestic market, helping increase selling prices and farmers’ income.”
According to the draft decree, if rice import volumes increase sharply, potentially affecting domestic production, they will be restricted. Besides, rice traders face stiffer penalties for failure to make quarterly and annual reports on exports and inventories as required.