To provide a level playing field for Basmati rice traders and millers from within and outside Punjab, especially in the light of the provisions of the new agriculture Bills, the Punjab government on Tuesday announced a reduction in the Market Development Fee (MDF) and the Rural Development Fee (RDF) rates from 2% to 1% each.
The move, which will also help keep the Punjab Basmati competitive in the international markets, will provide a relief to the tune of ₹100 crore to Basmati traders-millers, according to an official statement. “However, the change comes with the caveat that no refund of any fee will be allowed to any paddy-rice dealer, miller or trader for the export of the Basmati paddy-rice to other countries from the State,” it added.
The decision was announced by Chief Minister Amarinder Singh in response to a proposal of the Punjab Mandi Board, made after thorough examination of the representations received from the Punjab Rice Millers and Exporters Association and the Punjab Basmati Rice Millers and Exporters Association.
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The Punjab Rice Millers and Exporters Association had submitted that with the farm ordinances coming into force, the disparity in fees and other charges among the Basmati-producing States would be around 4%, thus making the rice industry in Punjab economically unviable as it would be unable to compete with rice exporters in Haryana, Delhi and Uttar Pradesh, which had totally exempted agricultural produce from the market fees.
They had also pleaded that Punjab-based exporters would not be able to cover the additional cost of taxes, which is 4% plus, thus making it extremely difficult for them to remain in business. This trend may force them to purchase paddy from other States to remain in competition with their counterparts in Haryana, U.P. and Delhi, the statement said.