The Hindu Business Line : Foodgrain exporters demand fresh FCI quotas

PRIVATE foodgrains exporters want the Union Government to remove the temporary suspension and issue fresh quotas for lifting of foodgrains from Food Corporation of India.

They have also requested Indian Railways for easy availability of rakes for immediate transportation of pending export orders.

According to Mr S.K. Jain, Chairman of the eastern region of Federation of Indian Export Organisations (FIEO), 10 million tonnes of foodgrain export orders are pending because the FCI is unable to release the material and supply the consignments up to the ports due to rake shortage.

Despite this, Mr Jain felt, the Union Government should lift the temporary suspension (which was effected in August 2003) of the quota allocation for foodgrains to the private exporters.

"Exports is a continuous process and the Union Government should immediately lift the ban. If it is delayed further then we will have to start from scratch, once again. Moreover, international buyers will start looking at other sources for meeting their domestic demands," Mr Jain told a press conference.

According to him, the current food stock with FCI is 25-26 million tonnes and the new crop will be around 220 million tonnes. Hence there is enough foodgrain in the country to maintain the food security. "I feel that the Government should immediately release quota for 10 million tonnes," he said.

In 2000-01, the Union Government first allowed export of foodgrains through the private parties. Between December 2000 and December 2003, 26.7 million tonnes of foodgrains have been exported by the private players. It includes rice, wheat and coarse grains.

For quite some time now, the Centre is contemplating introducing an exclusive grain export scheme for the private players. Mr Jain said that as an alternative to the release of fresh quotas, Union Government should announce this scheme as early as possible.

For wheat, the major importers are Indonesia, UAE, Bangladesh, Philippines and Vietnam and for rice, it is South Africa, North African countries, Bangladesh and UAE.

Mr Jain criticised the role of Indian Railways for the non-availability of rakes.

According to him, out of 2.2 million tonnes of pending orders, 1.4 million tonnes is from the eastern region and this is only due the shortage of rakes.

"Due to this shortage some exporters are sending their Bangladesh consignments though the Kandla and Kakinada ports. Currently Kolkata and Haldia port hardly get one or two rakes a month. As an alternative, the Union Government can lift the existing ban of exporting foodgrains through the land routes," he suggested.

Mr Jain also asked the Centre to give the exporters foreign currency loans at reasonable rates like a few basis points above Libor.

According to him, the forex reserve of $100 billion is lying idle with the Government and approximately $54 billion out of it came from export remittances.

"Currently medium sized exporters are getting loans at an interest of 8-9 per cent against the global standard of 3-4 per cent. This is making us uncompetitive. The appreciating rupee has already pushed us into a disadvantageous position," he said.

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