October 1, 2022

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India fails to deliver on its promise to become a major grain exporter |  Abroad

India fails to deliver on its promise to become a major grain exporter | Abroad

India appears to have failed to deliver on its earlier promise to become a major grain exporter. Sources told Reuters news agency, that due to the disappointing crops, the country may consider having to source the grain from elsewhere.

Shortly after the Russian invasion of Ukraine, Indian Prime Minister Narendra Modi enthusiastically declared that India was ready to “feed the world”. Just four months later, the opposite seems to be true. Due to the record heat wave that hit India this spring, the grain harvest is not as high as expected. Reduced production drove up prices locally, making everyday life more expensive for hundreds of millions of Indians. They use the grains to make basic foods like naan and chapati.

After the first indications that the wheat harvest would not be as high as previously estimated, grain exports were already limited. The state’s reserves fell to their lowest level in 14 years in August. Wheat became 12 percent more expensive for consumers. With shortages looming and prices rising, authorities are now preparing to buy wheat from elsewhere.

It is said that government officials are currently in talks about reducing or eliminating the 40 percent import tax on wheat to help flour manufacturers in some areas import the grain. However, India’s food minister said in a Twitter message on Sunday that there are no plans for grain imports and that there are sufficient stocks.

Although India is the second largest wheat producer in the world, it has not been a major exporter of wheat. Nor did it import much. The country was almost self-sufficient. Authorities now estimate that the 2021-22 crop will be around 107 million tons, up from an estimate of 111 million in February. The new estimate may be a bit overly optimistic, with traders and flour manufacturers expecting returns of 98 million to 102 million tons.

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