Kathmandu: The rapid surge in rice prices is gripping Nepal, with the cost of a single bag spiking from 200 to 500 rupees. The cause of this inflation is attributed to India's decision to halt rice exports to Nepal, except for Basmati rice.

Prime Minister Pushpa Kamal Dahal Prachanda's press advisor, Govind Acharya, clarified that despite India's rice export restrictions, Nepal's rice supply remains unaffected. He emphasized that the Prime Minister has promptly intervened, directing stringent market monitoring and enforcement against black market activities.

The recent phone conversation between the Prime Minister and relevant officials underscored the discussions held during Prachanda's visit to India two months ago. The bilateral discourse focused on the status of agreements made during that visit.

Previously, the Ministry of Industry, Commerce, and Supply conveyed Nepal's request to India to continue rice exports. Commerce Minister Ramesh Rizal appealed to the Indian Embassy to provide one million metric tons of paddy, an equal amount of rice, and 50,000 metric tons of sugar to Nepal. The Indian Embassy responded positively to this request.

Following India's decision on July 20 to prohibit the export of non-Basmati rice in order to curb domestic market price escalation, the black market responded by abruptly raising rice prices in Nepal. Prime Minister Prachanda promptly addressed the situation by initiating market monitoring measures after receiving confirmation from Indian Prime Minister Modi.

This year's rice production in Nepal is projected to decline due to untimely rains and planting challenges in various areas. Consequently, the government estimates annual rice production at 5.5 million metric tons. With this projection, Nepal may have to import around 1.5 million metric tons of rice from India.

The situation underscores the importance of monitoring domestic agricultural conditions and bilateral agreements to ensure a stable rice supply, alleviating potential market disruptions in Nepal.