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Successive years of bumper harvests have ignited calls for lifting a more than eight-year long ban on export of pulses, a demand, which experts said, overlooks the possibility of rising demand from domestic markets in the near future.
Most experts and analysts believe the government should not take any decision in haste, as there is every possibility that the domestic production growth is temporary and the demand-supply gap will not go away soon, but only widen in the coming years.
Their pessimism stems from the fact that output growth in pulses seen in the last three-four years has come largely on the back of area increase and not on any major technological advancement, which has its own limitations.
An analysis by a working group on the 12th Five-Year Plan (2012-13 to 2016-17) shows that despite the rise in production, domestic demand will continue to be more than the supplies in the next few years. It shows that India is expected to produce around 18-21 million tonnes (mt) of pulses till 2016-17, while demand is projected to touch around 22 mt in the next few years. ”Our rising pulses production will only help in import substitution and from the current 3-3.5 mt of annual imports, it might come down by one-two mt. But, I don’t think that it will lead to India becoming a export surplus country in the coming five-six years,” said Ramesh Chand, director of National Centre for Agriculture Economics and Policy Research (NCAP) and chairman of the working group.
He said it is only because of high prices that domestic pulses demand has seen some moderation in the last few years otherwise it would have far outstripped even the increased supplies.
Production of pulses -- a whole variety of which is grown in India such as gram, tur, masoor, urad, chick peas, rajma etc -- has been hovering around 11-15 mt since the late 70s. But, from 2010-11 (July-June) onwards there has been a sharp surge in output and production reached a record 18.24 mt in 2010-11. It continued to remain around 17-18 mt levels in the next few years and is projected to reach almost 18.5-19 mt in 2013-14.
“It must be remembered that the rise in pulses production in the last three-four years has largely come due to area increase and not because of any big technological advancement and unless that happens (a technological revolution), the demand and supply gap will continue to remain as demand is growing because of rising income levels,” said T Haque, director of Council for Social Development and a former chairman of the Commission for Agriculture Costs and Prices (CACP).
He said in some states government has tried popularising alternative pulses varieties, but its adoption is not picking up as per hectare net income from pulses is much lower than wheat and rice. “Therefore, it is very difficult to convince farmers to switch their crops,” Haque said, adding that allowing pulses imports at nil duty is also discouraging farmers.
Bimal Kothari, vice-chairman of Indian Pulses and Grains Association (IPGA), felt that allowing exports at this juncture would not alter the domestic price scenario as even in the best case only 500,000-600,000 tonnes out of the total production of over 18 mt will be exported.
“We must remember that pulses is mainly consumed by the Indian diaspora, so there cannot be a massive rise in demand, also imports are allowed freely at nil duty so any shortage can be handled,” Kothari said.
He said it was difficult to say whether the production growth seen in the last few years can be sustained, as output has remained stagnant for almost 30 years.
The government, too, is unclear as to whether it wants to allow exports of all varieties of pulses at this stage based on a few years of bumper production. A reason perhaps the agriculture ministry has gone slow on a proposal to lift the ban on export of all varieties of pulses.
“The proposal was discussed just informally. Moreover, I don’t think it will be feasible to allow export of all kinds of pulses at this stage,” a senior official from the department of agriculture said.
