Economy

India hikes wheat import duty to support local farmers

India has raised its import duty on wheat to 40 percent from 30 percent, the government said late on Friday, as the world’s No. 2 producer of the grain tries to support local farmers.

Prime Minister Narendra Modi’s party looks to contain rural discontent due to lower crop prices amid voting in a general election that began on April 11 and ends on May 19. 

Local wheat prices have fallen over 11 percent in 2019 due to ample supply from last year’s crop and forecasts of record output. 

The hike in duty is likely to make imports of wheat unviable for flour mills even after recent declines in global prices, potentially dragging further on global grain markets.

The government usually purchases about a quarter of such wheat from farmers at state-set prices to build stocks to run a major food welfare programme. India’s wheat production will rise 2 percent in 2019 from the year before to a record 99.12 million tonnes, according to estimates from the country’s agriculture department. Only one wheat crop is grown in India each year, with planting starting in late October and harvesting in March. Government wheat stocks stood at ..

The government usually purchases about a quarter of such wheat from farmers at state-set prices to build stocks to run a major food welfare programme. 

India’s wheat production will rise 2 percent in 2019 from the year before to a record 99.12 million tonnes, according to estimates from the country’s agriculture department. 

Only one wheat crop is grown in India each year, with planting starting in late October and harvesting in March. 

Government wheat stocks stood at 17 million tonnes as of April 1, up nearly 30 percent from the same time a year ago. 

“At 40 percent import duty, imports are not viable for flour mills. They have to buy local crop,” said a Mumbai-based grain dealer with a global trading firm. He declined to be identified as he was not authorised to speak with media.

Indian flour millers imported 1.65 million tonnes of wheat in the 2017/18 fiscal year, down from 5.7 million tonnes the year before. Those shipments were mainly from Australia, Russia and Ukraine. 

Related posts

RBI to Issue New Design 20 RS Note

Jay Patel

Trump: China Tariffs to Increase to 25% Friday

Jaymin Shah

Nasscom require 500 crore to develop new talents in India

Jaymin Shah