Saudi Arabia, a "fossil fuel superpower," is one of the world's top twenty economies, a business-friendly and trade-oriented country. Its imports increased 6.5% year on year to US$ 144,3 billion in 2019. Imports of cereals, rice, pork, and dairy goods have also increased.
Saudi Arabia can't produce enough rice goods domestically to meet local market demand, let alone a growing thirst for a wide range of cuisines and gourmet products, because only 1.5 percent of its total land area is classed as arable.
Rice is one of India's most widely farmed commodities, and Basmati rice is one of the country's most exported goods. Iran, Saudi Arabia, Iraq, Kuwait, the United Kingdom, and others are among the major purchasers of Indian Basmati rice. Relations between India and Saudi Arabia have improved both countries' economic standing. In FY 2019-20, total trade with Saudi Arabia stood for 4.23 percent of India's total trade.
Rice Importers In Saudi Arabia
Rice importers of Saudi Arabia account for a large portion of the global market for Indian rice, with around 90% of rice purchasers preferring to import various varieties of long grain rice such as basmati, non-basmati, parboiled, and normal white rice. Buyers who prefer to import medium grain kinds of rice make up the remaining 10% of the market. In 2017, a total of 1.4 million metric tons of rice were imported, contributing equally to both India and Saudi Arabia's effective GDP growth.
On 1st September 2019, the Saudi Food and Drug Authority (SFDA), the quality regulator of the nation, determined that each rice import consignment, originating from any country, must be accompanied by a Certificate of Conformity (COC). As a result, COC is now required for all Indian rice exporters and all consignments sent after September of the fiscal year 2019.
Saudi Arabia's new quality certification regulations for imported rice have paved the way for higher-quality rice imports and improved trading opportunities for Saudi Arabia's rice importers. Furthermore, it has increased the export opportunities and profit margins for many Indian rice exporters. SFDA has appointed two agencies in the market to maintain market growth and ensure correct COC compliance in the Indian rice business. For issuing COC to rice exporters from India, the two agencies are Intertek and Austria.
This has not only made the procedure easier, but it has also made it faster, allowing Saudi Arabian rice importers to receive their orders sooner.
Basmati Rice Importers In Saudi Arabia
Basmati rice importers in Saudi Arabia account for the majority of the country's rice import market share, as Basmati rice is used in almost all of the country's cuisines. This has also boosted the export of Basmati rice from India and Pakistan, as these are the only two countries that produce this type of rice. Saudi Arabia's Basmati Rice Importers prefer to import this variety of rice from India because the exporters there follow the COC rules to the letter.
India's Basmati Rice exports have climbed by almost 20% year on year. Until now, the total yearly export of Basmati Rice to Saudi Arabia has been between 4.0 and 4.5 million tonnes in the current fiscal year. This data clearly indicates that Saudi Arabian rice importers choose high-quality basmati rice from India.
In light of this, Indian officials have advised several guidelines to follow before exporting Basmati Rice to Saudi Arabia, in order to ensure that the required quality is met.
Saudi Arabia is a key export market for Indian basmati rice, accounting for 20% of the country's 4-4.5 million tons yearly exports. The key factor that Saudi Arabia considers while sourcing rice from Indian enterprises is hazard analysis and critical control points (HACCP).
All food products regulated by the Saudi Food and Drug Authority (SFDA) must comply with the following Saudi Food Law, Standards, and Regulations:
- Registration With Saudi Authorities
• Importers must have an SFDA account and must register their food products.
• Importers must have a current Commercial Registration Certificate with ‘Food Trade’ listed as a commercial activity.
• Rice exporters must register with the SFDA under the Foreign Establishment Registration Act.
- Laws, Rules, and Regulations
• The rice being imported into the kingdom must meet the SFDA's Standards and other Requirements.
• Expiration dates on food goods must conform to SFDAFD standards (SFDA.FD 150-1, SFDA.FD/GSO 150-2) for specific products and must meet the minimum shelf-life requirement for export to Saudi Arabia.
- Marking and Labelling Requirements
• The information about the rice being imported must be marked and labelled in Arabic. Other languages, in addition to Arabic, may be used as long as the information written in these languages is equivalent to the information expressed in Arabic text.
• Rice must be marked and labelled in accordance with SFDAFD/GSO 9 criteria, which emphasize consumer education as well as adherence to Saudi customs and Islamic values (offensive imagery, contents should be avoided).
- Additional Documentation
• Original invoice attested by the Trade Authority of the country of origin, India.
• A validated Certificate of Origin from the Chamber of Commerce of the country of origin, which in this case is India.
Exporters should conduct a conformity assessment of the rice that will be exported to Saudi Arabia for its Safety and Suitability standards, using various conformity verification techniques such as document evaluation, inspection, testing, container sealing, and so on. They will receive a Certificate of Conformity (COC) for consignments that meet the SFDA criteria, which can be utilized to clear the consignments quickly at Saudi Customs upon arrival at Saudi ports/borders.
• Document Evaluation
In this stage, the mandatory documents submitted with the RFC will be assessed to verify the details of the product consignment and its compliance with requirements (Commercial Registration Certificate, Halal Slaughter Certificate, Halal Certificate, etc.).
The food products will be tested to ensure that they meet the applicable SFDA.FD/SASO/GSO standards for safety and suitability in the second stage. The rice sample that was examined must meet the parameters for determining consignment compliance.
Physical inspection of the rice consignment will take place here, including the verification of product label markings and other physical requirements as per approved SFDA.FD/SASO/GSO Standards and Technical Regulations.
Rice shipments that pass inspection and testing will receive a Certificate of Confirmation (CoC), which will assist the importer in clearing the shipment through Saudi Customs.
A seal is used to seal containers, and the shipment must not be tampered with after it has been sealed.
Rice is a common ingredient in various cuisines all over the world. The kingdom of Saudi Arabia imports a significant amount of rice from India each year. Importing rice from India necessitates extensive documentation and paperwork, as well as approvals and other procedures.
In order to clear their food consignments via Saudi Customs, importers of Indian rice entering the Kingdom of Saudi Arabia (KSA) must adhere to the Saudi Food and Drug Authority's (SFDA) requirements.