Mar 18, 2016 03:03 PM IST | Source: PTI

Hailstorm may damage 13 million tonnes wheat: Report

Assocham General Secretary D S Rawat has pitched for reducing import duty on wheat to a more reasonable level of 5 to 10 per cent so that parallel imports by private trade would ease pressure on government stocks and prices due to better availability.

Hailstorm may damage 13 million tonnes wheat: Report

Wheat output is expected to fall by 13 million tonnes due to damage caused by unseasonal rains accompanied by hailstorms, and the government may have to import the staple grain, says a study.

The shortfall in production may lead to a spike in food inflation which may then contribute to price rise, according to the study by Assocham.

Assocham General Secretary D S Rawat has pitched for reducing import duty on wheat to a more reasonable level of 5 to 10 per cent so that parallel imports by private trade would ease pressure on government stocks and prices due to better availability.

"The country faces shortfall in wheat production by around 13 million tonnes from the initial estimates of 93.8 million tonnes in the current crop year and the development may force the government to consider imports of the staple grain as well," the paper said.

As far as stocks are concerned, the paper said a drop of 10-20 per cent in wheat procurement in the current year will result in around 35-36 million tonnes of wheat stocks as of July 1.

"Given an average monthly requirement of 3 to 3.5 million tonnes towards Public Distribution system (PDS) and open market wheat sales, wheat stocks would plummet well below 10 million tonnes as of April 1, 2017 forcing the government to consider imports to augment domestic shortage.." it added.

While the government can import duty free through its state trading arms, private traders too should be encouraged to import wheat with lower import duty, the paper added.

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