In a move to support local farmers to overcome price distress, India has raised its import duty on wheat to 40 per cent from the earlier 30 per cent, reports Financial Express.
The step has been taken as the prices of local wheat have fallen over 11 per cent due to excess supply from last year’s harvest and forecasts of record output.
India, the world’s second-largest producer of the grain, with this move looks to contain its agrarian distress due to lower prices. The step will make the imported wheat unviable to the flour mills even during a global decline of the prices.
The government is now trying to ensure prices remain above the support levels. India has raised the price at which it buys new-season wheat from local farmers by 6 per cent to Rs 1,840 per 100 kg for 2019. To build stocks to run a major food welfare programme, the government usually purchases about a quarter of such wheat from farmers at state-set prices.
India’s wheat production is expected to reach 99.12 million tonnes in 2019. Due to the high output, India’s wheat import has taken a dip from 5.7 million tonnes last year to 1.65 million tonnes this year. The imports were mainly from Australia, Russia and Ukraine.