In a move that could boost sagging rice exports from the country, Indonesia is working on an agreement with India to buy rice to get over its temporary deficit of the cereal.

“The details of price and quantity are yet to be arrived at. We are currently negotiating it,” a Commerce Ministry official told BusinessLine.

Both sides are working out details of a memorandum of understanding which is expected to be signed when Indonesian Trade Minister Thomas Lembong visits New Delhi later this month.

Non-binding deal “Although the MoU will be a non-binding one, it would at least give us an indication of the business that we might do with Indonesia,” the official said.

Lembong had indicated last month that his country may consider buying rice from India to get over the temporary shortage it would face in early 2016. Although it had traditionally purchased rice from ASEAN countries, Indonesia is now looking beyond to widen its options.

The Minister had said that Indonesia may include India in a list of countries from which rice imports could be authorised.

Gain for India The development comes at an opportune time for India as export of the cereal in the current financial year has been declining, compared to previous year, mostly due to a fall in imports by large buyers, such as Iran and Nigeria.

New Delhi is hopeful that the MoU would be for a longer period, on the lines of the one it recently signed with Islamabad.

Indonesia has reportedly agreed to import one million tonnes of rice from Pakistan valuing around $400 million over the next four years.

Indian exports “Indonesia is a net importer of rice, while India is one of the top exporters. We are happy that it has finally shown interest in buying from us,” the official said.

India had exported a total of 11.92 mt rice in 2014-15.

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