After announcing massive wheat exports as its trade goal, two days later, India bans wheat export, which comes as a big blow.
The u-turn on the wheat exports was two days after the government declared its plans for a major export drive, so this hit the public with disappointment. The ban on wheat exports comes with rapid effect as part of its measures to prevent the spike in prices at home. However, only export shipments for which letters of credit have been issued on or before yesterday’s notification will be allowed, the government said issuing a statement saying, “… the government will allow exports on requests from other countries, the notification issued by Directorate General of Foreign Trade (DGFT) said.
The report stated that the government had taken the decision “in order to manage the overall food security of the country and to support the needs of the neighboring and other vulnerable countries”.
Prime Minister Narendra Modi, during his recent visit to Germany, had told the Indian diaspora at an event that farmers of the country “have stepped forward to feed the world” amid a global shortage of wheat. “Whenever humanity is faced with a crisis, India comes up with a solution,” he said.
The renowned professor from Sweden and critic of the government, Ashok Swain tweeted, “In Germany, Modi had boasted in front of the Hindu right-wing diaspora that India would feed the world. Indian media had made it their headlines. Today, India banned wheat export. These guys are shameless liars.”
In Germany, Modi had boasted in front of the Hindu right-wing diaspora that India would feed the world. Indian media had made it their headlines. Today, India banned wheat export. These guys are shameless liars.
— Ashok Swain (@ashoswai) May 14, 2022
Global buyers had their hopes pinned on India
However, global buyers had their hopes pinned on India which is the world’s second-largest wheat producer after China – for supplies after exports from the Black Sea region plunged since Russia’s invasion of Ukraine in late February.
The move to ban wheat exports comes after huge crop loss due to a heatwave in March. The government is also under strain to rein in inflation that surged to 7.79 percent in April.
“The Centre will send trade delegations to Morocco, Tunisia, Indonesia, Philippines, Thailand, Vietnam, Turkey, Algeria, and Lebanon for exploring possibilities of boosting wheat exports from India. India has set a target of a record 10 million tonnes of wheat in 2022-23 amid rising global demand for the grain globally,” a government statement said Thursday.
“There is a rise in the demand for Indian wheat in the global market, farmers, traders, and exporters have been advised to follow all the quality norms of importing countries so that India emerges as a reliable supplier of wheat globally.
“We are extending our support to all the stakeholders in the wheat exports value chain for boosting shipment from the country,” M Angamuthu, Chairman, Agricultural and Processed Food Products Exports Development Authority, said at a sensitization meeting on wheat exports in Karnal, Haryana, according to the government release.
The Department of Commerce planned to organize several such meetings in major wheat-growing states such as Punjab, Haryana, Madhya Pradesh, Uttar Pradesh, and Rajasthan, it added.
There was no plan to curb wheat exports earlier
A Reuters report had quoted earlier in the month a top official of the Ministry of Consumer Affairs, Food and Public Distribution saying that India is not looking to curb wheat exports.
“There is no move to curb wheat exports, as the country has sufficient stocks of wheat,” Food Secretary Sudhanshu Pandey had then said.
When asked about the hasty shift in the plan, government sources conveyed that China is drawing food grains from India after crop loss led to food security concerns there.
After five consecutive years of record harvests, India cut its wheat output forecast to 105 million tonnes from a February estimate of 111.3 tonnes after the heatwave hit crop yields.
In a different report, the DGFT announced the easing of export conditions for onion seeds. “The export policy of onion seeds has been put under the restricted category, with immediate fact,” it said. The export of onion seeds had earlier been banned.
Some sources feel that the wheat export ban by the government is done to favor some individuals at the cost of farmers who would have reaped abundant benefits from the wheat export.