US President Donald Trump’s imposition of a 50 percent tariff on Indian goods has opened the door for Pakistan to capture a bigger share of the American market. The US trade flows are reportedly already shifting away from India, creating new export opportunities for Pakistan, particularly in basmati rice.

 

According to data from a global trade platform, 24 percent of Pakistan’s basmati rice was exported to the US between November 2023 and October 2024, with the country importing a staggering 1,519 shipments of rice from Pakistan.

 

The US imports rice from Asian countries, as locally produced rice differs greatly in aroma and quality. According to the US Department of Agriculture (USDA), rice imports have increased over the past three decades, rising from just seven percent of the domestic market in 1993 to a sizable 25 percent by 2023.

 

The USDA expects a growth in the demand for rice imports in the coming periods. The US sources over 60 percent of these imports from Asia, with Thailand, India, and Pakistan serving as top exporters of rice to the economic hegemon. 

 

However, with US-India tensions heightening, mainly because of India’s economic ties with Russia, Pakistan could outcompete India on American shelves. Currently, India’s basmati rice faces a 50 percent tariff as opposed to the 19 percent tariff that Pakistani rice imports into the US bear.

 

Reports have highlighted how this gives Pakistan a clear pricing advantage over India in the US market. Details from Indian media outlets have revealed that India’s basmati rice exports to the US could plunge by a whopping 80 percent. 

 

This is because the price of importing India’s basmati rice into the US has soared to a staggering $1,800 per metric ton. For reference, the price of India’s basmati rice to US customers is now over 24 percent higher compared to importing rice from Pakistan, as Pakistani basmati rice is priced at roughly $1,450 per metric ton.

 

US retailers and importers have already begun sourcing their basmati rice from Pakistan, instead of India, as its prices are unmatched compared to India. Reports suggest that customers have welcomed the change too, citing a retail worker who outlined that Pakistan’s basmati rice is “already popular” in the US. 

 

Data from the Rice Exporters Association of Pakistan (REAP) indicates that Pakistan exported over 772,000 tons of basmati rice in fiscal year (FY) 2023-24, allowing for export revenues of $876.9 million. However, this number could grow significantly in Pakistan’s favour, as the odds and tariffs are stacked against India.