India can’t deliver on its promise to become major grain exporter

India seems unable to keep its earlier promise to become a major grain exporter. The country is reportedly even considering having to source grain from elsewhere due to disappointing harvests. Sources told Reuters news agency.

Shortly after the Russian invasion of Ukraine, Indian Prime Minister Narendra Modi declared bravuraly that India was ready to “feed the world.” Barely four months later, the opposite seems true. Due to the record-breaking heat wave that hit India this spring, the grain harvest is lower than expected.

Lower production has pushed up prices locally, making daily life more expensive for hundreds of millions of Indians. They use grain to make staple foods like naan and chapati.

After initial indications that the wheat harvest would be lower than previously estimated, grain exports were already restricted. State reserves fell in August to their lowest level in 14 years. For consumers, wheat became about 12 percent more expensive. With the looming shortage and rising prices, authorities are now making preparations to buy wheat elsewhere.

Government officials are reportedly currently discussing whether or not to reduce or eliminate the 40 percent import tax on wheat to help flour manufacturers in some regions import grain. However, India’s Food Minister indicated in a message on Twitter on Sunday that there are no plans for grain imports and that there are sufficient supplies.

Although India is the second largest wheat producer in the world, it has never been a major exporter. Nor has it ever imported much. The country was pretty much self-sufficient. Authorities now assume that the 2021-22 crop will be about 107 million tons, up from an estimate of 111 million in February. The new estimate may be a little too optimistic, as traders and flour manufacturers are predicting yields of 98 million to 102 million tons.

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