Problem of plenty: India to export 2 MT wheat.

India, one of the world’s largest wheat producers, has set aside two million tonnes (MT) of wheat for exports to meet growing demand from neighbouring countries, Agriculture Minister Sharad Pawar said on Wednesday.

“We have set aside two million tonnes of wheat that will be given to countries which have been asking for it through diplomatic channels,” Pawar told reporters after a meeting of agriculture ministers of South Asian Association of Regional Cooperation nations.

He said the quantum of wheat to be sent to various countries will be decided by the Ministry of External Affairs.

On Monday, Prime Minister Manmohan Singh had asked a committee of secretaries to explore the option of wheat export as the country has huge surplus stocks.

High procurement and ample supplies have led to a problem of plenty for the government. This is a sharp about-turn from 2006 and 2007, when India had to go in for massive imports to feed the poor and cool down open market prices, which had sky-rocketed due to poor domestic production.

A senior government official said the Food Corporation of India will have at least 6 million tonnes extra wheat in its kitty on April 1 after accounting for reserves, a part of which can be exported if global prices are attractive.

As on October 1, the FCI had 22 million tonnes wheat in its granaries. Pawar Tuesday said in 2009, India will surpass the previous year’s bumper wheat output of 78.4 million tonnes.

Open market prices of wheat have not risen beyond Rs 1,100 a quintal this year on abundant supplies. India had a record procurement of more than 22 million tonnes in 2008, helped by a high support price of Rs 1,000 a quintal.

Source : Business Standard