Rice is one of the most consumed food items around the world. This also makes it one of the most commonly imported food products. In 2018, the global imports of rice increased by 4.8% compared to 2017. Further, Asia is the continent which imports the most rice. During the year 2018, Asian nations imported rice worth $11.7 billion. Among the Asian countries, Indonesia is a key importer of rice. This is because of the fact that the young population of the country does not want to work in rice fields.
Furthermore, as of 2018, the top three countries from which Indonesia imported rice include Thailand ($386.5 million), Vietnam ($360.7 million) and India ($139.2 million). Despite the key role played by India in Indonesia’s rice imports, various importers in the country are unaware of the key regulations and procedures related to importing from the South Asian country. This article will help you in understanding the import process and analyze the key regulations governing the import of rice from India.
Importers in Indonesia need to comply with various regulations when it comes to importing rice. Firstly, they need to apply for an import license. There are two major types of licenses that are issued to Indonesian importers — Import for further distribution, and Import for their own use. Licenses for both these activities cannot be obtained at the same time. Importers need to submit the documents related to the trade before they can avail their license. Secondly, the imports into Indonesia must be compliant with the Indonesian National Standards (SNI). These standards have been developed in order to ensure that high-quality products are imported into the country.
Thirdly, once the rice has been imported into the country, it is subjected to pre-market and post-market control systems. Pre-market checks include the verification of the quantity and quality of rice imported into Indonesia. On the other hand, post-market checks include the validation of the use of rice. These checks are undertaken by The National Agency for Drug and Food Control, (which is known as BPOM) Indonesian importers need to file registration documents with the BPOM in order to import rice from India. Import permits and the necessary validations are then provided by the BPOM on a case to case basis.
In addition to the above, importing rice into the country also requires the importer to complete an inspection procedure. Further, the rice that has been imported into the country also needs to be labeled in the local language, which is Bahasa Indonesia. The grade of the rice must also be specified. The Indonesian importers also need to provide the authorities with information regarding the packaging of the rice. This includes test results related to the package quality and a letter of statement from the importer. This statement includes information related to the material used for the packaging. In case these documents are not provided to the authorities, it may result in the import being declared invalid. Therefore, the importers need to be extremely careful and ensure full compliance with the regulations.
In order to make sure that the import process is conducted in a smooth manner, importers can take the help of international financial institutions. These institutions offer specialized financial instruments that help importers in conducting their trade. One of the most well-known institutions offering such services is the Euro Exim Bank. Euro Exim Bank offers various financial instruments such as Bank Guarantees and Letters of Credit (LCs). These instruments help importers in importing rice from India and also ensure compliance with the various regulatory and documentation requirements. Further information about the Euro Exim Bank and its major offerings is available here.