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India to Begin Wheat Imports After Six-Year Gap
Context
India is poised to begin wheat imports after a six-year gap, to replenish depleted reserves and hold down prices that leaped following three years of disappointing crops.
Key Highlights
- Import Tax: New Delhi is expected to lift a 40% tax on wheat imports, allowing private traders and flour millers to purchase from producers like Russia.
- Timing: The government is likely to wait until after June, once the new wheat harvest is in, before removing the import tax.
Need for Imports
- Declining Harvests: After five consecutive record harvests, high temperatures severely reduced India's wheat crop in 2022 and 2023.
- Current Crop Forecast: This year's crop is expected to be 6.25% lower than the government estimate of 112 million metric tons.
- Rising Prices: Domestic wheat prices have remained above the state-set minimum purchase rate of 2,275 rupees per 100 kg and have recently started increasing.
- Depleted Stocks: Wheat stocks in state warehouses dropped to 7.5 million metric tons in April, the lowest in 16 years, after the government sold over 10 million tons to control prices.
Procurement Process
- Purpose: The government procures food grains (rice, wheat, and coarse grains) to ensure farmers receive the minimum support price (MSP) and to maintain stocks for distribution to the poor under the public distribution system (PDS) and other schemes.
- Agencies Involved: The Food Corporation of India (FCI) and state government agencies (SGAs) handle wheat procurement.
- Procurement Systems:
- Centralised Procurement: FCI or SGAs directly procure food grains for the Central Pool, which are used for welfare schemes and calamity relief.
- Decentralised Procurement: Managed by the respective states.
- MSP Declaration: The government announces the MSP before sowing based on the Commission for Agricultural Cost and Prices (CACP) MSPs apply to 23 farm commodities, including wheat and rice, but there is no statutory backing mandating their implementation.
Fact Box:
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PYQMains Q1: What do you mean by the Minimum Support Price (MSP)? How will MSP rescue the farmers from the low-income trap? (2018) Q2: What are the major reasons for declining rice and wheat yield in the cropping system? How crop diversification is helpful to stabilize the yield of the crop in the system? (2017) Prelims Q1: What is/are the advantages/advantages of zero tillage in agriculture? (2020)
Select the correct answer using the code given below:
Answer: D Q2: Consider the following crops: (2013)
Which of these are Kharif crops?
Solution: (a) |
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