The Government of India has fixed an export quota of 2 lakh tonnes (200,000 tonnes) of wheat for Nepal, which was announced recently by the Directorate General of Foreign Trade (DGFT).

This decision comes after India's ban on commercial wheat exports in May 2022, though there are still government-level exemptions in place. Wheat exports to Nepal are facilitated through India's National Cooperative Exports Limited.

However, the announcement of this quota has been met with some dissatisfaction by Nepali traders and importers.

The delay in the quota announcement is seen as problematic, especially since the harvesting of new wheat crops in Nepal is about to begin, which will increase the local supply.

This delay could mean that demand for imported wheat might decline as Nepalese farmers start to harvest their own crops.

Additionally, the initial batch of 50,000 tonnes under the quota system was received by Nepalese traders. However, the second batch of 2 lakh tonnes was not fully purchased by them. Despite this, the third lot of wheat export quota is now being provided.

The Ministry of Commerce in Nepal had requested a quota of 3 lakh tonnes based on strong demand from flour mills, but only 2 lakh tonnes were allocated.

There is concern among traders that the delay in setting the export quota may impact their ability to plan ahead, particularly as they were expecting an earlier and larger allocation. Wheat is one of the most important grains in Nepal, ranking third after rice and maize.