How far India has succeeded in harnessing its export potential in rice? Evidence Using Stochastic Frontier Gravity Model

Abstract

This study employs the stochastic frontier gravity model (SFGM) to objectively assess the determinants of India’s rice exports from 2001 to 2019 across 22 major export destinations, highlighting untapped export potential and providing actionable policy recommendations for enhancing competitiveness in global rice markets. Results show that India's economic growth (GDP) and the GDP of importing nations positively impact rice exports. Conversely, geographical distances (representing transportation costs) and higher import tariffs act as deterrents. The devaluation of the Indian rupee positively influences export revenues. Common language benefits exports, while regional trade agreements show minimal impact. The study estimates significant untapped export potential between India and its partners, emphasizing the need for improved trade facilitation, logistics, and agreements.

To maximize India's rice export potential, policymakers should prioritize quality compliance, streamline regulations, and invest in infrastructure and R&D for rice cultivars. Negotiating favorable trade agreements and implementing existing export policies like the New Agricultural Export Policy will aid market access and competitiveness.

KEYWORDS:

• Export
• rice
• panel data
• gravity model
• export potential
• India

JEL Classifications:

• F13
• F62
• O24

Acknowledgements

The contribution of anonymous reviewers involved in the revision process of this manuscript is highly acknowledged.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Data availability statement

The information has been gathered exclusively from sources that are accessible to the public.

Notes

1 Structural break test was conducted by calculating test statistic ‘supW (tau)’ and comparing with its critical value at 5 percent significance level.