July 27, 2009

India's federal government has decided to ban the export of rice and wheat through diplomatic channels as concerns of a weak monsoon have raised fears of a shortfall in crop output, the farm minister said Friday (July 24).

 

"We were allowing the export of non-basmati rice through diplomatic channels, which we decided to stop," Sharad Pawar told lawmakers in Parliament. "We were allowing the export of about 2 million tonnes of wheat through diplomatic channels and we are just about to take a decision to stop it."

 

Last year, the government allowed the export of 55,000 tonnes of non-basmati rice and 2 million tonnes of wheat through diplomatic channels. However, wheat and rice exports by private trade have been banned since 2007 to cool prices and boost local supplies.

 

"The situation may improve, but I don't want to take any risk when the country's food security is concerned," Pawar said.

 

A formal notification on the scrapping of exports has yet to be issued.

 

State-run Food Corporation of India has bought about 31 million tonnes of rice and 25.2 million tonnes of wheat to boost the country's food stocks.

 

"The stock position is quite comfortable. I want to assure that we have sufficient stocks for 13 months in our kitty."

 

India is estimated to reap a bumper harvest of 99.15 million tonnes of rice and 78.58 million tonnes of wheat in the year ending March 2009.

 

However, faltering and erratic monsoon rains have caused damage to the summer-sown crop, mainly rice, oilseeds and sugar cane. The main rice crop is sown with the arrival of monsoons in the June-July period.

 

The annual monsoon rains, which arrived over the country May 23 this year, are so far 19 percent below normal, Pawar said. Nearly 60 percent of India's farmlands are rain-fed.

 

The northern and northwestern regions, which are key rice and wheat growing regions, have been the worst-hit by the poor rains.

 

"The monsoon this year has been weak and erratic in progress and distribution, resulting in late sowing of crops," Pawar said.

 

The summer-sown rice crop, which is sown over 39.1 million hectares, is lower by about 21 percent on year at 11.5 million hectares until July 17.

 

The main shortfall has been in the central states of Madhya Pradesh and Chhattisgarh, the eastern states of Bihar and West Bengal and in the northeastern states of Manipur and Assam, he said.

 

"Our worry is paddy (rice) and we will definitely concentrate on the winter-sown as well as the summer-sown crop," Pawar added.