April 21, 2011
 

India should permit wheat exports

Since India has enormous grain inventory and global prices are favourable, the country should permit exports of wheat, according to Farm Minister Sharad Pawar said on Wednesday (Apr 20).

Pawar's remarks came a day after India forecast normal monsoon rains which could boost farm output and encourage exports, though concerns over persistently high domestic food prices may weigh on any government decision to sell overseas.

With Prime Minister Manmohan Singh's Congress party facing a slew of state elections, the government is unlikely to take chances with grain stocks.

"The government will definitely apply its mind whether to enter international markets. International markets are favourable for wheat, rice, sugar and cotton for exports. We are comfortable in all these," Pawar said.

India, the world's second-largest producer of wheat, has kept a tight control over grain exports since 2007 when adverse weather conditions hit production and the Indian government had to turn to costly imports.

The country has allowed only limited sales in diplomatic deals while the nation's stocks swelled after three straight years of bumper harvests, leading to some rotting of grain because of storage problems.

India's wheat reserves swelled to 17.2 million tonnes by March 1, more than double a government target of 8.2 million tonnes. That, combined with forecasts of a record harvest of 84.3 million tonnes in 2011, has prompted industry and trade to demand that export curbs be lifted.

Pawar also said the country would achieve the targeted 4% growth in farm sector in the current fiscal ending March 2012.