Govt may reintroduce import duty on wheat

With stocks set to cross a record 96 mn tonnes, duty will help ensure payment of MSP to farmers

The Central government might re-introduce the import duty on wheat if the need be, food minister Ram Vilas Paswan said on Tuesday.

The duty on wheat was abolished by the government in December 2016 after prices started rising in the open market due to low stocks.

However, it invited a lot of criticism on the grounds that it might dishearten farmers as it was announced right in the middle of the 2016-17 sowing season.

Now, with wheat production expected to reach a record of over 96.6 million tonnes in the 2016-17 crop season that will end in June, the Centre could be considering re-introducing the duty.

Traders and industry players though said there is no need to bring back import duty as India might need to import another 2-3 million tonnes of wheat in 2017-18 marketing year as well. The 2017-18 rabi marketing year will start from April 1.

"Government will take all necessary steps to ensure payment of MSP to farmers and may review the import duty on wheat if required," Paswan said in a statement issued today.

Earlier, too a very senior Central government official had said that the decision to abolish import duty on wheat is not permanent.

The Central government has fixed a target to purchase over 33 million tonnes of wheat from farmers in 2017-18, which is over 43 per cent more than the actual procurement of 2016-17 marketing year.

The minister also said during the ongoing kharif rice marketing season that started from October, the Centre has procured 44.4 million tonnes of paddy (around 27 million tonnes of rice) and record quantities of pulses.

"However, there were complaints that even then they were not getting the MSP for Moong and Arhar, following which the government responded, first, by increasing the buffer stock of pulses from 1.5 million tonnes to two million and also engaged central agencies such as FCI, Nafed and SFAC to procure pulses directly from farmers which is still going on," Paswan said.

He said to ensure that farmers don't face any problem in selling their wheat crop; procurement for which will start from April 1, 2017, the Centre has made extensive preparations with special attention to farmers from the eastern states.

He said the Centre abolished the import duty on wheat to increase its domestic availability and within a span of around two months around 4 million tonnes of wheat has been imported this year and more than 5.5 million tonnes have been contracted.

Paswan also expressed satisfaction over the second advanced agriculture production figures released by the ministry of agriculture and congratulated his counterpart for achieving a record grains output.

According to the second advance production estimates, the production of major crops is expected to be 271.98 million tonnes.