India set for wheat imports after six years, to shore up reserves
India is poised to begin wheat imports after a six-year gap, to replenish depleted reserves and hold down prices that leaped following three years of disappointing crops, sources say, as the approaching end of general elections removes a key hurdle.
New Delhi is expected to abandon a 40% tax on wheat imports this year, officials and other sources told Reuters, paving the way for private traders and flour millers to buy from producers such as top exporter Russia, albeit in modest volumes.
As the new-season wheat harvest rolls in, the government is likely to wait until after June to scrap the import tax, in time for Russia's harvest, the sources said.
«There is a compelling case for the removal of the wheat import duty,» said Pramod Kumar, president of the Roller Flour Millers' Federation of India. «That is the best possible way to ensure sufficient supplies in the open market.»
The government is likely to concede to the demand.
«The considered view is that the wheat import duty should be removed after June, so that the private trade can import wheat,» said a government source aware of the matter.
«And to protect our farmers' interest, the duty should be reinstated before wheat planting starts in October,» added the source, who spoke on condition of anonymity to describe the likely course of action by the next government.
Prime Minister Narendra Modi's Bharatiya Janata Party is widely expected to win the election, which ends on June 1, with vote-counting set for June 4.
Traders say they will start importing if
