India likely to import 2 MT wheat to boost supplies.

NEW DELHI: India is likely to import up to 2 million tonne (MT) wheat in the current fiscal after the customs duty cut on the grain to boost domestic supply and check prices, according to flour millers.

"Imports will increase in the coming months and reduce pressure on the domestic availability," Food Ministry Joint Secretary Prashant Dwivedi told PTI on the sidelines of an AGM of Roller Flour Millers Federation of India (RFMFI) here.

He said the government will not discontinue the sale of FCI wheat to bulk consumers like flour millers.

Asked about likely quantity to be imported this fiscal, Dwivedi declined to give any figure.

However, the industry players estimated that overseas purchase of the grain would touch 2 MT in the 2016-17 fiscal helped by duty cut.

Already, about 6,00,000 tonnes of wheat has been imported from Australia, Ukrain, France and Russia, while another 4,00,000 to 5,00,000 tonnes is in the pipeline, RFMFI Ex-President M K Datta Raj said.

"Total wheat imports are expected to be 2 million tonnes this year," he said.

Much of the imports are being undertaken by flour millers in south India. Now with the duty cut, imports have become viable for flour millers in Maharashtra and West Bengal, he added.

Four millers are importing Australian white wheat in big quantities, which is costing about Rs 19.50 per kg for delivery at Bangalore after the duty cut, while earlier it was costing Rs 23 per kg, he explained.

Last week, the government had slashed import duty on wheat to 10 per cent from 25 per cent till February 2017.

The country's wheat production is estimated to be 93.50 million tonnes in the 2015-16 marketing year (April-March), while the industry players peg 5 million tonnes less output.

Despite projection of higher production, the state-run Food Corporation of India (FCI) has procured only 22.9 MT as against the target of 30.5 MT set for the 2016-17 marketing year (April-March). The bulk of the procurement was done during April-June.

Source : economictimes.indiatimes.com