Government's rapid decisions

14-Sep-2024 01:12 PM

Within the last three-four days and especially on 13 September 2024, the Central Government has taken many such decisions which are likely to have a profound impact on the market of agricultural products. On the one hand,

an attempt has been made to increase the supply and availability of wheat in the domestic sector and to control prices by increasing the period of stock limit on wheat,

while on the other hand, an attempt has been made to help farmers get higher prices for oilseeds by increasing the import duty on edible oils by 20 percentage points.

Apart from this, the minimum export price (MAP) fixed for Basmati rice and onion has been abolished.

Not only this, but the time limit for duty-free import of yellow peas has also been extended for two months. Earlier its period was to expire on 31 October 2024, but now it will remain in force till the end of the current year i.e. 31 December 2024.

In this way, the government has tried to influence the market activities by taking different decisions about important agricultural products like wheat, rice (Basmati), pulses (yellow peas), edible oil and onion. This will have far-reaching effects. 

Increasing the time limit for import of yellow peas will provide relief to the importers and they will continue to try to import more and more of it from other countries including Canada and Russia. Its huge import has already taken place in the country.

At present, a good stock of it is also present. The new decision of the government will help the importers to contract yellow peas for shipment between October-December.

It is worth noting that in India, the government does not fix the minimum support price for peas. The increase of 20 percent in import duty on edible oils will increase its domestic market price and processors will get an incentive to buy oilseeds from farmers at a higher price.

Similarly, farmers are expected to get relief due to the end of MAP of Basmati rice and onion. To maintain control on wheat prices, the stock limit period has been extended.