With the sudden change in moong bean import policy, the importers are staring at a loss running into few hundred crores as cargo of up to 50,000 tonnes was getting prepared to be shipped before March 31 from places such as Myanmar and East Africa, trade sources said.

The Centre in a notification on February 11 put imports of moong beans in the “restricted” category from “free” with immediate effect.

“We cannot quantify the losses, though its going to be enormous. This sudden change in policy will lead to lot of issues such as defaults, litigations and suppliers losing confidence among others,” said Bimal Kothari, Vice-Chairman, Indian Pulses and Grains Association (IPGA), the apex trade body.

‘Knee-jerk decision’

Kothari said the importers could have contracted around 50,000 tonnes of moong beans to be brought into the country over next several weeks. “As the shipments had to take place by March 31, the shippers were also preparing the shipments. They are also making huge losses in the process. This is a knee-jerk decision. While we welcome the Indian Government protecting the interests of the farmers, the interests of the business community should not be hurt,” Kothari said

Vatsal Lilani, President, Overseas Agro Traders Myanmar, said the frequent and sudden policy changes create immense financial hardships and uncertainty for everyone in the supply chain including marginal farmers in Myanmar.

Traders in Myanmar, based on the “free” import policy, have entered into binding contractual obligations for the export of moong from Myanmar. These contracts are spread right up to March 31, 2022 and advance payments have been received for the same from Indian importers, Lilani said.

As on date there are about 1,400 containers with cargo valued at around $30 million (₹227 crore) are lying in ports awaiting shipment and therefore do not have any Bill of Lading. The payments for this cargo have been received in advance from locations like Singapore against orders placed from India, Lilani said. The containers have not been able to leave the port primarily due to logistical reasons. In regular working processes, it takes about 12 to 15 days from the time the containers reach the warehouse for stuffing till the date on which the vessel gets loaded and sails for India. This period of 12 to 15 days is for the material to be stuffed, inspected, fumigated, custom cleared and few days of waiting in the port awaiting vessel arrival.

“We therefore request the Indian Government to provide reasonable advance notice to the market before introducing new policies that can hamper existing trade commitments and immediately withdraw this notification and allow imports till March 31, 2022,” Lilani said.

India’s moong imports during April-September FY 21-22 stood at $76.9 million as compared to $77.14 million in the entire financial year 2020-21.

Fall in MSP

Trade sources said that the fall in moong prices below the MSP of ₹7,275 per quintal could have prompted the government to act. While admitting that prices have slipped below MSP, Kothari said that it was for the damaged quality of moong bean. Rains during the kharif harvest had impacted the quality of moong across States such as Maharasthra, Madhya Pradesh, Rajasthan and Karnataka. The good quality moong is being traded above MSP, Kothari said.

In its first advance estimates issued on September 21 last year, the Agriculture Ministry had pegged the moong output at 2.06 million tonnes, higher than the targeted 2.02 million tonnes and the previous year’s fourth advance estimate of 2.01 million tonnes. However, the trade was expecting a lower crop due the erratic rainfall pattern in States such as Rajasthan, Karnataka, Maharashtra and Madhya Pradesh among others. In the ongoing rabi season, moong acreage is estimated at 5.13 lakh ha, lower than the normal area for the season of 9.4 lakh ha and previous year’s 7.03 lakh ha.

Related Topics
comment COMMENT NOW