Sept 16 (Askume) – India has approved a plan to boost exports of some agricultural products and vegetable oils ahead of local elections in two states.Several measures were implemented to restrict imports , with farmers being an influential voting bloc.
The move surprised the market as New Delhi usually attempts to protect the interests of consumers during the festive season. However, this year it put aside inflation concerns and prioritised supporting farmers.
Here are some facts about policy initiatives for rice, vegetable oil, wheat, onion and yellow peas:
Ease export restrictions
India has removed the minimum export price to help farmers boost sales of premium basmati rice abroad.
Last year, New Delhi had set the minimum export price (MEP) at $1,200 per tonne and later reduced the MEP to $950 per tonne.
India and Pakistan, the sole producers of Basmati rice, compete for the global market share of this premium rice.
New Delhi has also abolished the $550 per tonne MEP on onions, one of India’s most popular food items.
The world’s largest onion exporter also reduced export tax from 40% to 20%.
Collection
India, the world’s biggest importer of edible oils, has imposed a 20% basic customs duty on major edible oils to help farmers grappling with low oilseed prices.
The effective import duty on crude palm oil, crude soybean oil and crude linseed oil was increased from 5.5% to 27.5% as they are subject to the Indian Agriculture Infrastructure and Development Tax and Social Welfare Surcharge.
India raised import duty on refined palm oil, refined soybean oil and refined sunflower oil from 13.75% to 35.75%.
More than 70% of India’s vegetable oil needs are met through imports, and palm oil accounts for over 50% of total imports.
State Assembly elections
Analysts said the move was aimed at garnering support from farmers in Maharashtra and Haryana, which are major producers of onions, sugar and soybean, while Haryana is a major producer of basmati rice.
Prime Minister Narendra Modi’s ruling Bharatiya Janata Party (BJP) will do anything to retain power in Haryana, one of the most crucial states in north India.
Haryana voters will elect a new assembly on October 5.
The BJP will also try to win over farmers in the western state of Maharashtra, where assembly elections are due later this year.
Earlier this year, the BJP lost nearly 75 rural seats in India’s general elections.
Rules will be tightened for wheat traders and processors
India has eased the limit on wheat stocks held by traders and millers.
Traders can now store only 2,000 tonnes of wheat, while the previous limit was 3,000 tonnes.
India has extended the duty-free import licence period for yellow peas from end of October to December 2024.
