Increased demand for wheat flour in the international market led to a price rise in domestic market.
India has decided to put a restriction on the export of wheat flour, to "ensure a curb on rising prices". The decision was taken by the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, on Thursday
The CCEA said, the restriction on the export of wheat flour "will ensure a curb on rising prices of wheat flour and ensure food security of the most vulnerable sections of the society."
The government explained that the conflict between Ukraine and Russia had led to disruptions in the global wheat supply chains, increasing demand for Indian wheat. Due to the prohibition on the export of wheat (grain) in May, the demand for wheat flour increased in foreign markets. Its exports from India registered a growth of 200% during April-July 2022 compared to the corresponding period in 2021.
The wheat prices had hit a high in the global market due to the Ukraine -Russia war, as Ukraine is one of the world's largest exporters of wheat. India is the second largest producer of wheat but not a major exporter.
An increase in demand for wheat flour in the international market led to a significant price rise in the domestic market. The note clarified that earlier there was a policy to not prohibit or put any restrictions on the export of wheat flour. Therefore, a partial modification of the policy was required by withdrawing the exemption from ban/ restrictions on the export of wheat flour to ensure food security and put a check on mounting prices of wheat flour in the country.
Sources told NDTV that till May there was enough buffer and the government allowed the export of wheat. Private traders also made good profits during that period. However, by May the government was clear that it needed to shore up resources for domestic needs. But sources said that India has already clarified that there will be no restrictions while supplying wheat through the World Food Programme (WFP). India remains committed to helping the more vulnerable countries. It has been pointed out that decisions with regards to wheat trade will be taken on a case-by-case basis and will also clear commitments till the date of the ban - 13th May.
India's ambassador to the UN, Ruchira Kamboj said on Wednesday that India has been approached for the supply of wheat and sugar by many countries and it was responding positively. Ms Kamboj said, "In the last three months alone, India has exported more than 1.8 million tons of wheat to countries in need, including Afghanistan, Myanmar, Sudan and Yemen."
She said as food security remained a major concern, it was necessary to stress on equity, affordability and accessibility when it comes to food grains.