After a gap of almost two years, India has again started importing foodgrains and this time it is rice, the trigger for which came from the worst monsoon in decades that pulled down paddy acreage by almost 60 lakh hectares and could bring down the total rice output by 10 million tonne to 15 million tonne.The annual rice procurement, through which the government builds its buffer stocks to run PDS and other welfare schemes, has improved slightly after getting off to a slow start. Till last week, state agencies have managed to procure around 77 lakh tonne of paddy, which is 2% higher than last year.
But, given the uncertainty surrounding rice procurement this year because of fears that Uttar Pradesh, Bihar, Andhra Pradesh Tamil Nadu and Chhattisgarh might contribute very little to the central kitty, the decision to import almost 30,000 tonnes of rice by December, looks quite apt and prudent. The decision also conveys a strong signal to the world grain markets that though India could import rice this year, it won?t come in a haste and there won?t be any huge tenders, like the one when wheat was imported a couple of years back.
Experts also believe that India?s decision to import rice so early in the procurement season affirms the government?s commitment to prevent any speculative buildup of prices, and sends a strong signal to private traders and millers that any abnormal jacking up of price by taking advantage of the shortage situation will be firmly dealt with, either through the huge buffer stock or else through imports.
India?s rice buffer stock as on October 1, 2009, was estimated to be around 14.5 million tonne, against a buffer requirement of 5.2 million tonne. The trigger for imports could also have come from reports that Philippines, the world?s largest rice importer, has lost around 1 million tonnes of the crop in the recent typhoons and floods, as against the earlier estimate of around 800,000 tonne.
Whatever the actual reason be behind clearing the imports, the idea seems right and the timing looks absolutely perfect. The only thing that could go against the imports is pricing. But, at the same time, if the imports are meant to build a reserve for future or to keep domestic prices under check, then bearing a slight financial burden seems reasonable.
sanjeeb.mukherjee@expressindia.com
