Enough stock of wheat in India, government has no plans to import

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The government's Department of Food and Public Distribution has clarified that there is no plan to import wheat into India and that the country has sufficient stock to meet the domestic requirements.

Responding to a recent report by business daily Mint, the Food department tweeted, "There is no such plan to import wheat into India. Country has sufficient stocks to meet our domestic requirements and FCI has enough stock for pubic distribution."

There is no such plan to import wheat into India. Country has sufficient stocks to meet our domestic requirements and @FCI_India has enough stock for pubic distribution.

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— Department of Food & Public Distribution (@fooddeptgoi) August 21, 2022

State reserves have declined in August to the lowest level for the month in 14 years, according to Food Corporation of India (FCI), while consumer wheat inflation is running at close to 12 per cent, as per the report.

The looming shortage and rising prices now have authorities making preparations to buy from overseas. Government officials are discussing whether to cut or abolish a 40 per cent import tax on wheat to help flour millers in some regions to import grain, according to the report.

“Given a lot of the war risk premium has come off from global wheat prices, India can look at augmenting its domestic wheat supply via more imports,” said Sonal Varma, an economist at Nomura Holdings Inc.

“However, since domestic wholesale wheat prices are lower than global prices, a reduction in import duties will also be essential to make it a viable option.”

Despite being the world’s second-biggest wheat grower, India has never been a major exporter. It also never imported much, with overseas purchases at about 0.02 per cent of production annually. The country was pretty much self-sufficient.