India Bans Export Of Wheat With Immediate Effect: Find Out Why?

India Bans Export Of Wheat With Immediate Effect: Find Out Why?
India Bans Export Of Wheat With Immediate Effect: Find Out Why?

Govt of India has banned exports of wheat, with immediate effect. Notification regarding this ban has been issued by Directorate General of Foreign Trade.

This ban won’t be applied for those exports, which already has irrevocable letters of credit (LoC) issued before or after the date of the ban, that is May 14, 2022.

On Thursday, the issue of wheat stock with the government to meet the statutory requirement under food security law and other welfare schemes and the increasing prices of edible oils was brought up before the committee of ministers headed by home minister Amit Shah. 

Sources said officers marked certain concerns over the present speed of export of wheat to other countries and the probable trend for the next few months because of the prolonged Russia-Ukraine war.

This has now resulted in the ban of wheat exports with immediate effect.

Detailed plan was presented before the committee of ministers

Yesterday, a detailed plan was prepared and presented before the committee of ministers in which road transport minister Nitin Gadkari, finance minister Nirmala Sitharaman and food and commerce minister Piyush Goyal are also members. Based on this, the inter-ministerial panel decided to impose a total ban on export of wheat from India.

The government had set the aim of exporting 10 million tonnes (MTs) of wheat during the year 2022-23. India exported 7 MTs in the year 2021-22 and almost 50% of it was exported to Bangladesh.

In the past few weeks, the situation has changed drastically. Previously, the FCI’s wheat granaries were overloaded but now the agency is looking at its lowest ever procurement in more than a decade due to the ongoing international situation. 

Atta prices have risen since last year

Official data display that both modal and average price of loose atta (flour) has risen in the past year. The modal price – the most widespread price across centres – was Rs. 28 per kg on Thursday compared to Rs. 24 a year ago. Similarly, average price of atta was Rs 36.2 a kg on Thursday as compared to Rs 29.7 on the same day in the year 2021.

Until now, huge stocks of the foodgrain with the FCI helped the government to protect nearly 80 crore people from any increase in prices and this also prevented any dramatic rise in atta prices in the market.

In the meantime, Nicaragua and Syria have requested wheat imports of approximately 4 lakh tonnes on a government-to-government basis and the first consignment of wheat to Egypt may be shipped soon.

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