India set to revive wheat imports after 6 years to shore up dwindling reserves
The stage seems set for India to resume wheat imports after a gap of 6 long years as the country braces to replenish its depleting strategic grain reserves and stabilize spiraling domestic prices. Multiple government sources have confirmed to this reporter that India is likely to scrap the 40% import duty on wheat once the ongoing general elections conclude next month, paving the way for private traders to source wheat supplies from major exporters.
With state warehouses currently holding the lowest wheat stockpile in over a decade at just 7.5 million tons, reopening imports appears the only viable option to bolster buffer reserves and meet the country’s bulging demand. Domestic wheat prices have shot up in the aftermath of consecutive drought-hit harvests, remaining well above the minimum government price. Unless imports are allowed, it will be an uphill task for authorities to procure enough grain for public distribution and replenish reserves above the 10 million ton safety benchmark.
Russia, the largest wheat exporter globally, is expected to be the primary supplier which meets India’s modest import needs estimated at 3-5 million tons. With this year’s domestic production also predicted to fall short by nearly 7% due to extreme heatwaves, imports in the upcoming months could provide much-needed relief by easing price pressures during the crucial festival season. Sources indicate the import duty will be reimposed before the next sowing season starts in October to protect farmers’ interests.
It is evident the incoming government recognizes removing restrictions on private wheat shipments as the most pragmatic solution currently. Wheat reserves were built by importing over 10 million tons after the pandemic but the modus operandi now needs a reset. If imports commence as foreseen, it will signify India’s return to Global markets and reaffirm its commitment to ensure National food security even in the testing times ahead.
