Govt imposes 10% import duty on wheat

Government today imposed 10 per cent import duty on wheat till March 2016 to curb shipments and liquidate poor quality grains lying in FCI godowns.
A copy of notification in this regard was placed before Lok Sabha by Finance Minister Arun Jaitley.
Jaitley said that the notification dated August 7 seeks to "impose basic customs duty of 10 per cent on wheat till March 31, 2016 under Section 159 of the Customs Act 1962."
At present, there is no import duty on wheat. Private traders are importing the grains on lower global prices and lack of high-quality grains in the domestic markets.

Imports are happening despite bumper domestic wheat output in 2014-15 crop year and surplus stocks with the Food Corporation of India (FCI), the nodal agency for procurement and distribution of foodgrains.
FCI has procured 28.08 million tonnes of wheat this year, of which 26.62 million tonnes have been purchased under the relaxed quality norms because the crop got damaged due to unseasonal rains early this year.

The government is keen to sell off on priority basis the wheat which was procured under the relaxed quality norms through ration shops, welfare schemes and open market sales.
Amid sluggish supply of high quality wheat, private flour millers have started importing wheat from Australia for the first time in a decade. They have contracted for import of 5,00,000 tonnes of wheat from Australia.

Wheat production in India, the world's second biggest grower, is estimated to have declined to 90.78 million tonnes in 2014-15, as against the record production of 95.85 million tonnes during 2013-14.
Still, the government has a huge stock of wheat at over 40 million tonnes due to bumper procurement this year and carryover stock from the previous years.