India has shipped out as much as 1.3 million tonne (MT) of wheat since a ban was imposed on the grain’s exports in May, a senior government official told FE. The exports include despatches against letters of credit (LCs) issued before the ban was slapped and supplies under government-to-government (G2G) deals, he added.
While prohibiting wheat exports on May 13 to curb a rise in local prices, the government made it clear that it would meet the genuine needs of neighbouring countries and food-deficit nations through G2G deals and honour supply commitments already made. Moreover, the shipments that were already backed by LCs issued before the ban would be allowed, it stated.
About 3,50,000 tonne of the grains have been supplied under the G2G channels to food-deficit nations that had sought India’s help after the prohibition was imposed, the official said.
Permits against LCs have been issued for wheat exports of 2.1 MT, said the official. This means only about 1.1 MT more can be shipped out this fiscal on the basis of the LCs issued earlier if the government doesn’t relax the ban.
In all, about 3.9 MT of wheat has been exported so far this fiscal, more than a double from a year before. In FY22, the country’s wheat exports hit a record 7.2 MT, way above 2.1 MT in the previous year.
About 10 countries – including Ethiopia, Indonesia, Bangladesh, Qatar, Oman, Yemen and Jordan – had requested India to supply around one million tonne of wheat in the wake of the ban on wheat exports from May 13 but the entire demand is unlikely to be fulfilled. Indonesia and Bangladesh have emerged as the biggest beneficiaries of the post-ban despatches.
However, suspecting a flood of fake and illegal LCs, the DGFT later warned wheat exporters that it would examine cases for referral to the Central Bureau of Investigation and the Economic Offences Wing if they were found to be using back-dated LCs to get permits for shipping out the grain.