India's rice exports are expected to increase by more than 18 % in the financial year to end-March 2008, despite a sharp rise in the global rice prices as demand exceeds supplies.

India’s surging rice exports are expected to sustain the ongoing bullish phase over a period of time mainly due to the strong sales to new markets such as Iran in spite of high domestic prices.

India has earlier banned exports of non-basmati rice in early October last year in order to rein in prices and help stem price pressures but later eased the restrictions, allowing overseas sales of rice priced above $500, PMT.

Export prices for higher grades of Indian rice, including basmati, were likely to touch an average of $1,300 PMT in the year to end-March, as against $750 PMT the year before.