The Indian government has no intention to lift the export ban on wheat, though it is in the process of wrapping up its scrutiny exercise for allowing shipments for which letters of credit were issued before May 13, when the bar came into force. Total approvals are set to add up to around 2.1 million tonnes (mt), a source tracking the issue said.
Russia’s recent grain deal with Ukraine, following which it has agreed to unblock certain Ukrainian ports to allow the export of wheat, corn and other cereals, is likely to ease the global pressure on India to lift the wheat export ban, as the volatility in international prices for wheat is expected to lessen, the source told BusinessLine.
“The verification process is being carried out by the DGFT for LCs issued prior to the announcement of the wheat export ban is almost over with just some residual cases, of around 2 lakh tonnes of wheat, being dealt with. Total approvals are likely to be around 2.1 million tonne. There is no talk yet of lifting the export ban on wheat though,” the source told BusinessLine.
India, however, is open to supplying wheat on a government-to-government basis to neighbours and countries facing food security threats. It has already sent shipments to several nations including Bangladesh, Oman and Afghanistan after the ban was announced, the source pointed out.
The DGFT had imposed a ban on wheat exports from India on May 13, 2022, following concerns over a possible shortage in the domestic market as the unprecedented heatwave in March had hit production in the country and domestic prices, too, were surging.
Output seen even lower
“The Centre has no plans yet to take a relook at the wheat export ban as domestic prices continue to be very high. There are indications that the actual wheat production in the 2021-22 crop season, which ended in June, is likely to have been lower than the official estimate of 106.41 mt which was lower by 4.41 per cent of the previous estimate of 111.32 mt,” the source said.
While imposing the export ban on wheat, the government said it would allow consignments for which letters of credit were issued before May 13. However, there was a flood of requests and online applications from traders, seeking permission for exporting over five mt of wheat, which led the DGFT to put in place an intensive scrutiny process..
“It finally turned out that only less than half of the applications for pending exports could genuinely establish that the LCs were both issued and transmitted prior to the ban and, thus, a total of about 2.1 mt is to get the export nod,” the source said.
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