Why is the government delaying pulses import permits?

G Chandrashekhar | Updated on June 25, 2020

Why is the Ministry of Commerce delaying allocation of quota for pulses import and not issuing import permits? This inordinate and unexplained delay is truly frustrating not just for the trade, but also for overseas suppliers and pulse growers in developing countries (Myanmar, East Africa) wanting to supply to India.

For fiscal 2020-21, the government has announced quantitative ceiling of 4 lakh tonnes (lt) each for urad (black matpe) and tur/arhar (pigeon pea), and 1.5 lt each for moong (green gram) and peas.

Myanmar is the country from where a substantial volume of these dals is expected to arrive; and it is well known that pulse growers in Myanmar, too, are small like in our country and dependent on markets such as ours.

In case of urad, the allocation has been done (small quantity for a large number of applicants) and some importers have received permits. It is believed, some urad shipments are on the way and likely to arrive early July.

In case of other pulses, applications for quota allocation have been submitted by importers, but allotment has not been made yet. It is unclear what is holding up the government from making allocation and issuing requisite permits.

It could not be the intention of the government to protect domestic pulse growers because quite strangely, it was only earlier this month the government reduced customs duty on imported lentils (masur) from 30 per cent to 10 per cent for no valid reason.

Lower duty is applicable for imports that arrive before August 31. As a rabi crop, India harvested 14 lt of lentil only 2-3 months ago, and yet import duty was reduced. The government was possibly misguided by RBI statement in May that sought a review of duty on pulses based on weak premises; but on its part the government (Ministry of Finance and Ministry of Consumer Affairs), perhaps, had no clue about market conditions.

Kharif harvest

India’s own kharif-harvested pulses (tur/arhar, urad and moong) will come to the market by October/November. So, it would have been logical for New Delhi to have quickly issued import permits (even as early as April/May) so that cargoes can reach India well in time and help meet increase in consumption demand during the traditional festival season in August, September and October.

Apparently, the commercial intelligence within the government is rather limited if not non-existent. No one seems to have an idea about the global markets and prices as well as managing the timing of import. No wonder, Indian government’s intransigent attitude forces supplier countries to lodge complaints at the WTO. This can be avoided by simply abiding by the commitment to fulfil the quantitative ceiling well in time.

Lobby pressure

Reports circulating within the trade circles suggest New Delhi succumbed to pressure from certain groups opposed pulses import. It would be short-sighted on the part of policy-makers to fall prey to such lobby pressure. After all, a notification has been issued specifying quantitative ceiling for 2020-21.

It is nobody’s case that pulses import should be thrown open free; but the country must stand by its commitment to allow import under QR. India must continue to remain an integral part of the global value chain even if for small quantities. Our agriculture is fragile and vulnerable; and therefore it would be prudent to stay engaged with overseas suppliers.

At the same time, steps to boost domestic consumption are necessary in order to provide economical vegetable protein to several hundred millions of consumers suffering from under-nutrition.

The writer is a policy commentator and agribusiness specialist. Views are personal.

Published on June 25, 2020

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