Indonesia to Import 1m Tons of Pakistan Rice in New Deal
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Indonesia will import 1 million metric tons of milled rice over the next four years from Pakistan, in a move to shield the country’s food security against volatile weather patterns.
The two governments, represented by Indonesia’s Trade Minister Thomas Trikasih Lembong and Pakistan’s Ambassador to Indonesia Mohammad Aqil Nadeem, signed a memorandum of understanding on Tuesday.
The deal, with an estimated worth of $400 million in imports between 2016 and 2019, will be executed by Indonesia’s procurement agency, Bulog, and Pakistan’s Trading Corporation of Pakistan.
Indonesia currently has similar MoU with Cambodia, Myanmar, Thailand and Vietnam, though only some of the deals have been realized.
Pakistan is the world 11th largest rice producer with annual production of 6.9 million tons of milled rice.
The country saw trade with Indonesia rise 27 percent to $2.2 billion last year following a Preferential Trade Agreement in 2013.
Indonesia enjoyed $1.8 billion surplus in the trade, thanks to its palm oil exports.
Questions & Answers
Q.Why is Indonesia importing rice from Pakistan?
Why is Indonesia importing rice from Pakistan?
Indonesia is importing the rice to help protect its food security. This is a measure taken to guard against unpredictable weather patterns which can impact domestic food supplies.
Q.How much rice will Indonesia import from Pakistan under this deal?
How much rice will Indonesia import from Pakistan under this deal?
Indonesia plans to import one million metric tons of milled rice from Pakistan. This volume is spread out over a four-year period, specifically between 2016 and 2019.
Q.Which organisations are responsible for executing this rice import deal?
Which organisations are responsible for executing this rice import deal?
Indonesia's state procurement agency, Bulog, will handle the execution on their side. Pakistan's Trading Corporation of Pakistan will be responsible for their part of the deal.
Q.Has Indonesia signed similar rice import agreements with other countries?
Has Indonesia signed similar rice import agreements with other countries?
Yes, Indonesia currently holds similar Memorandums of Understanding with several other nations. These include Cambodia, Myanmar, Thailand, and Vietnam, though not all have been fully realised.
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