New Delhi - The International Monetary Fund has said it would 'encourage' India to remove restrictions on export of a certain category of rice, which, it said, would have an impact on global inflation.

The Indian Government on July 20 had banned the export of non-basmati white rice to boost domestic supply and keep retail prices under check during the upcoming festive season. This type of rice constitutes about 25 per cent of total rice exported from the country.

There would be no change in export policy of par-boiled non-basmati rice and basmati rice, which forms the bulk of exports, the food ministry had said in a statement.

In the current environment, these types of restrictions are likely to exacerbate volatility on food prices in the rest of the world. They can also lead to retaliatory measures, Pierre-Olivier Gourinchas, Chief Economist, International Monetary Fund (IMF), told a press conference here.

'So, they are certainly something that we would encourage the removal of these types of export restrictions, because they can be harmful globally,' he said in response to a question.

The total exports of non-basmati white rice from India was $4.2 million in 2022-23 as against USD 2.62 million in the preceding year. Major destinations of India's non-basmati white rice exports include the US, Thailand, Italy, Spain and Sri Lanka.

In order to ensure adequate availability of non-basmati white rice in the domestic market and to allay the rise in local prices, the government has amended the export policy from 'Free with export duty of 20%' to 'Prohibited' with immediate effect. The IMF in its latest economic update released here on Tuesday projected India's growth rate to be 6.1 per cent for fiscal year 2024, which is slightly up from 5.9 per cent estimated projection for the same period in April.

'India remains an economy that is growing quite strongly. I mean, it's coming down from really a very strong year in 2022, at 7.2 per cent. That was also revised upwards, by the way -- but still slow down, but still fairly strong growth and fairly strong momentum,' Gourinchas said.

Later in an interview, when asked about India's rice export ban, Daniel Leigh, Division Chief, IMF Research Department, told PTI that the context is clearly, an environment of declining inflation around the world.

'That's important because then it allows monetary policy to ease up and not to start increasing interest rates, which means currencies move around,' he said.

'We see it in the interest of the overall global community to keep that food and energy inflation trend down. Now the challenge is that if we see restrictions in other countries as well as India, we've been very clear that in our view we understand the domestic consideration, but if you see that global impact, then that would go against the reduction in inflation. So our perspective is that such restrictions should be phased out as soon as feasible,' Leigh said.

He also said that India's digital public infrastructure is really world class and it is enabling efficiency gains for businesses.