CHANDIGARH: In a major setback for Indian basmati exporters, the Australian Federal Court has rejected their plea seeking an exclusive certification trademark for the rice in Australia.
The most affected by the rejection are Haryana and Punjab. Of these, Punjab alone accounts for about 40 per cent of the country’s basmati export.
The ruling has come at a time when basmati exporters from both states were looking to expand into alternative overseas markets amid uncertainty over shipments through the Strait of Hormuz.
Ranjit Singh Jossan, vice-president of the Basmati Exporters Association, said the recent ruling meant that Indian exporters would not have an exclusive position in the Australian market and would now have to compete with exporters from the neighbouring country Pakistan.
Pakistan, on the other hand, has welcomed the decision.
The Agricultural and Processed Food Products Export Development Authority (APEDA) had argued in the Australian Federal Court that basmati grown in India enjoys Geographical Indication (GI) status and therefore sought its recognition as a certification trademark in Australia. But the court turned down its plea, stating that GI tagging in Australia, New Zealand and Canada was limited only to "champagne."
The Australian authorities concluded that consumers understood basmati as a type of rice associated with a broader geographic region rather than a certification badge controlled by a single authority such as India.
"Basmati rice is produced in the Indo-Gangetic plains at the foothills of the Himalayas, which includes parts of northern India and Pakistan...,’’ the court order by Judge Dowling J said on August 11.
The word 'basmati' does not distinguish between certified APEDA rice and other basmati rice.
The court relied on provisions of Australia’s Trade Marks Act 1995, particularly Section 177(2), which sets out the factors for determining whether a certification mark is capable of distinguishing certified goods from non-certified goods.
The factors indicate that goods or services meet specified standards or characteristics, which can include geographical origin, rather than serving primarily to distinguish the product of one trader from those of another.
It was in 2019 that APEDA first filed the trademark application in Australia, stating that the substantial presence of Indian basmati in the Australian market between 1988 and 2018.
The volume of Indian basmati sold through Australian retail outlets was estimated at 306,095 tonnes, which was valued at $380 million, while the sale of Pakistani basmati was only $44.12 million.
In January 2023 also, the application of APEDA was rejected by the Australian trademark office, arguing that since basmati was also grown in Pakistan, India cannot be recognised as the sole producer.
Then APEDA challenged the decision of the trade mark office before the Australian Federal Court and sought a de novo (from scratch) hearing.
Previously, it faced similar difficulties in securing exclusive recognition for basmati in New Zealand and Kenya. While in the European Union, APEDA's application for recognition has been pending since July 2018.
This decision will also be important for Nepal, as India has been objecting to basmati produced and packaged there.
The ruling is a major challenge, but the primary focus must remain on protecting the rights and interests of basmati farmers, the exporters believe.
The exporters said they are ready to work with APEDA to strengthen certification, branding and market protection to ensure better returns and a secure future for basmati growers.