Why Japan's Rice Shortage Isn't Basmati's Opening

India Japan Kaizen — Food Bridge Series, Part 4

Part 1 of this series named two structural gaps holding back food trade between Japan and India: Japan's strict food-safety system, and the lack of any accessible path for a mid-sized Indian processor or D2C brand. Part 2 tracked the joint-venture pipeline crossing that gap anyway — Kewpie, the Ichibanya-Mitsui venture, Kagome, Kikkoman, Assam's homegrown matcha. Part 3 put an actual price on the first gap: certification costs, a mango ban, and a mobile-lab scheme trying to lower the bar. This part asks about the other side of the bridge — once a product can clear Japan's gate, how does it actually reach a Japanese shelf or shopping cart? The clearest test case right now is rice, because it's the exact product India's government is pushing hardest on, in public, this quarter.

A Fifteen-Year-Old Pact Comes Up for Review

India and Japan's Comprehensive Economic Partnership Agreement (CEPA) was signed in February 2011 and took effect that August — fifteen years old this year. At their annual summit in New Delhi in July, Prime Ministers Modi and Takaichi agreed the pact was due for a refresh, and in August, at an investor roadshow in Osaka, Commerce Minister Piyush Goyal said India would use the review to press for greater market access for basmati rice specifically, alongside processed foods more broadly. Goyal called rice "a sensitive sector" in Japan — accurate: Japan restricts how much rice it lets in, and applies duties on anything beyond that permitted quantity. He also flagged processed food as a genuine opportunity, provided Indian exporters meet the same quality and safety bar Part 3 priced out. One detail undercuts the momentum, though: as of that same Osaka appearance, the terms of reference for the review itself hadn't been agreed yet. Both sides say they're open to it. Nobody has written down what "it" covers.

Why Japan's Rice Shortage Looked Like an Opening

The timing isn't random. Japan's domestic rice prices spiked hard enough over the past two years that imported rice — even after tariffs — became price-competitive for the first time in decades, and Japanese consumers and retailers responded. Private-sector rice imports, the portion that sits outside Japan's government-run quota system, reached 96,834 metric tons in 2025 — a 95-fold jump from just 1,015 tons in 2024, and the highest figure since Japan's current import system began in 1999.

• The quota layer. Japan's WTO "minimum access" system, in place since 1995, brings in roughly 770,000 tons of rice a year tariff-free, including up to 100,000 tons earmarked for direct table-rice consumption. That table-rice slice is imported through government-run Simultaneous Buy and Sell (SBS) tenders, with Tokyo capping its own markup at ¥292 per kilogram.
• The private layer. Anything imported outside that quota faces a flat tariff of ¥341 per kilogram — steep, but no longer steep enough to keep imported rice off Japanese shelves once domestic prices climbed far enough.

Indian rice exporters noticed. Industry representatives met Japan's embassy in Delhi in May 2025, and a Japanese official there put a number on the opportunity: Japan needs to import somewhere in the range of 500,000 to 700,000 tons of rice a year, and was, in that official's words, "seriously considering India" as a source.

The Catch Nobody's Resolved

Two things complicate that opening, and neither has moved since. First, the United States simply took it: of the 96,834 tons of private rice Japan imported in 2025, 75,638 tons — 78% of the total — came from the US. India doesn't register as a separate line in that year's breakdown at all.

Second, and more fundamental: Japan's shortage and India's basmati push aren't actually the same market. What Japanese households and restaurants are short of is short- or medium-grain, sticky rice — Japan's own rice officials describe the specification as under 10% amylose content, the starch that determines whether rice clumps together or stays separate. Basmati is the opposite kind of grain by design: long, aromatic, and bred specifically to stay dry and separate when cooked, for a completely different cuisine. India's own rice exporters are candid about where that leaves basmati today — it already reaches Japan, but mostly in small volumes aimed at the Indian diaspora, not as a substitute for the sticky rice Japanese consumers are actually short of. Goyal's CEPA push and the headline rice-shortage story are two different grains that happen to share a news cycle.

Where Packaged Food Actually Reaches a Japanese Shelf Today

Part 2's joint ventures run in one direction: Kewpie and Kagome selling finished Japanese product into India, backed by capital large enough to absorb a slow market entry. The reverse flow — Indian food reaching a Japanese shelf — runs through a much smaller, older layer of specialist importers that this series hadn't named yet: firms like Tokyo-based Sharma Holdings, which imports, wholesales, and retails Indian food brands across Japan and runs its own ready-to-eat Indian line out of a production facility in Tochigi; Tokyo-based Nishimoto Co., a long-established importer-wholesaler-distributor across Asian foods broadly, not India-specific; and Osaka's Sartaj Foods, which imports and distributes Indian and South Asian products regionally. These businesses work, and they've worked for years — but they sit in the specialty-grocery and diaspora-retail channel, not the mainstream aisle. A search for any Indian packaged-food or spice brand running its own storefront on Amazon Japan or Rakuten, or stocked at a mainstream chain like AEON or Kaldi Coffee Farm, turned up nothing in this year's reporting. The mid-sized processor or D2C brand Part 2 flagged as missing from the joint-venture pipeline is just as absent from the Japan-side retail shelf.

What's Still Missing

The CEPA review that's supposed to open basmati access further doesn't have terms of reference yet. The mango ban Part 3 covered remains unresolved as of the most recent reporting. No Indian packaged-food or spice brand has a visible direct-to-consumer or mainstream-retail presence in Japan today. And even if the CEPA review does land a rice commitment, nothing public yet says whether it would run through Japan's government-controlled SBS tender system or through the private commercial channel that just absorbed a 95-fold import surge — and on the evidence of this year's numbers, those are two very different doors to walk through.

If you work in retail buying, import-distribution, or e-commerce platform operations on either side of this relationship — and especially if you've tried to get an Indian food or beverage brand onto an actual Japanese shelf or storefront — get in touch. This is exactly the kind of practical knowledge India Japan Kaizen wants to connect to the people trying to make this crossing.

This is Part 4 of India Japan Kaizen's Food Bridge Series, publishing weekly. Part 5 will check whether the CEPA review's terms of reference have been set, whether the mango ban has lifted ahead of next season, and look at geographical-indication recognition — for Darjeeling tea, Basmati, and Alphonso alike — as a possible shortcut past the certification costs Part 3 priced out.