Basmati is a long-grain aromatic rice grown in a defined belt of the Indo-Gangetic plain that includes the Punjab districts on both sides of the border. It commands several times the price of ordinary paddy.
It uses substantially less water than the coarse varieties, matures earlier, which lengthens the window before wheat sowing and reduces stubble burning, and it earns foreign exchange. Every argument for diversifying Punjab's cropping points at it.
The problem is procurement. Basmati is sold on the open market, not to the government at a support price, so the farmer carries the price risk. In a bad year the price collapses and nobody is buying.
It also carries a pesticide residue problem. European Union limits on tricyclazole and other residues have led to consignment rejections, and the Punjab government has banned several pesticides on basmati as a result.
India and Pakistan both claim basmati and have fought over the geographical indication in European and other markets, which is one of the very few things the two countries argue about that is entirely about Punjab.
Basmati is grown in a defined belt of Punjab, Haryana, Uttarakhand and western Uttar Pradesh, and the geographical indication covers that area on the Indian side.
It uses less water than the coarse paddy varieties, is sown later, and sells on an export market rather than to procurement, which makes it the one commercially viable alternative in the paddy belt.
Pesticide residue is the constraint. European rejections of consignments over residue limits have repeatedly hurt the trade, and the residue comes from what is sprayed in the fields.