Government likely to impose 10% import duty on wheat
In a move to curb shipments and settle poor quality grains lying in storage godowns, Government of India is likely to impose 10% import duty on wheat shipments. However, the decision is yet to be taken based on the consultations with the concerned ministry and departments. Currently there is no import duty on wheat imports. The traders and flour millers are importing grains on lower price, due to lack of availability of high-quality stock in domestic markets. Imports are on rise despite the bumper domestic wheat output in the 2014-15 crop year, and surplus stocks with the Food Corporation of India (FCI) in their storage godowns. The government’s move in this regard will definitely come as a help to the domestic industry which has been facing challenges due to excess stocks. As per the 2nd Advance Estimates, total food grains production in the country is estimated at 257.07 million tonnes during 2014-15. This is the fourth highest quantity of annual food grains production in the country. Despite deficiency of 12 % in the monsoon rainfall during the year, the loss in production has been restricted to just around 3 % over the previous year and has exceeded the average production during the last five years by 8.15 million tonnes. Going by the statistics, Food Corporation of India has procured 27.6 million tonnes of wheat so far in the current marketing year that started from April. The corporation stepped to procure poor quality wheat due to relaxed norms for procurement of the grain this year. Due to sluggish supply of high quality wheat domestically, private flour millers started importing wheat from Australia for the first time in a decade. And, they were already said to have contracted for import of 5,00,000 tonnes of wheat from Australia and are planning to purchase another 5,00,000 tonnes from France and Russia. However, the government’s likely move to impose import duty on food grains would contain shipments and create a place for the domestic market.
June 30, 2015 | 7:41 pm IST.