High rates, rigid norms lead to costly wheat imports

High international wheat prices coupled with India's reluctance to ease its stringent import norms are seen pushing up cost of imported wheat to around $320 a tonne, cost and freight, in the latest 1-million-tonne tender, industry officials said.

Bids this time around are seen way higher than those in the tender floated last month""that was rejected by the government citing high prices.

The 1-million-tonne wheat import tender that was scrapped had attracted bids in the $267-302 a tonne range.

Later, a couple of bidders had also agreed to supply about 300,000 tonnes wheat at $263 a tonne but the offer was ignored.

Last year, India had imported over 5 million tonnes wheat at a weighted average cost of around $205 a tonne.

In the new tender floated by the State Trading Corporation Tuesday seeking delivery in August-November, the government has relaxed some commercial terms in a bid to seek lower prices, but quality norms remain unchanged.

The government has reduced the validity period for the bid bond to one month from three in the earlier tenders, while the performance bank guarantee validity has been cut to nine months from the earlier one-year norm.