India stops wheat exports with immediate effect to control the domestic price rise
- In Reports
- 11:45 AM, May 14, 2022
- Myind Staff
Union Government has prohibited wheat export with immediate effect as a scorching heatwave curtailed output and local prices hit an all-time high amid strong export demand.
Directorate General of Foreign Trade issued a notification in this regard yesterday.
It has been stated in the notification that amendment in the export policy of wheat has been done in order to manage the overall food security of the country and to support the needs of the neighbouring countries and other vulnerable countries.
It has been further stated that export will also be allowed on the basis of permission granted by the Government to other countries to meet their food security needs and based on the request of their government.
Directorate General of Foreign Trade said, there is a sudden spike in the global prices of wheat due to several factors and as a result, food security of India, neighbouring countries and other vulnerable countries is at risk. It said, the government is committed to provide food security.
Global buyers were banking on India which is world's second-biggest wheat producer for supplies after exports from the Black Sea region plunged following Russia's invasion of Ukraine in late February. Prior to the ban, India was targeting to ship out a record 10 million tonnes this year.
The Indian ban could drive up global prices to new peaks and hit poor consumers in Asia and Africa.
"The ban is shocking," a Mumbai-based dealer with a global trading firm said. "We were expecting curbs on exports after 2-3 months, but seems inflation numbers changed government's mind."
Rising food and energy prices pushed India's annual retail inflation up towards an eight-year high in April, strengthening economists' view that the central bank would have to raise interest rates more aggressively to curb prices.
Wheat prices in India have risen to record high, in some spot markets to as high as 25,000 rupees ($322.71) per tonne, versus government fixed minimum support price of 20,150 rupees.
Image source: Reuters
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