The government has directed its regional authorities to issue contract registrations to wheat exporters who have a non-recourse letter of credit (LOC) so that they can honor their contracts.
The directive comes from the Directorate General of Foreign Trade (DGFT), a branch of the Ministry of Commerce that deals with export and import-related matters, allowing foreign shipments even after the government has banned wheat exports for which an unchangeable LOC was issued in May or earlier. . 13.
Under the DGFT, all RA (Regional Authorities) have been directed to register the contract (RC) with the wheat exporters, especially within a specified time limit of 24 hours after submission of application, in all cases completed by the exporters. “, DGFT is a trade. Said in the notification.
It added that assistance / assistance / export of wheat on humanitarian basis from government to government would be approved on a case-by-case basis with the specific approval of the competent authority.
Due to good demand for Indian wheat from abroad, India’s wheat exports in FY 2021-22 stood at an all-time high of 60 million tonnes, valued at USD 2.05 billion. Out of the total wheat exports, about 50 percent of the consignments were exported to Bangladesh in the last financial year.
So far in the current financial year, according to estimates, 4.3 million tonnes of wheat has been contracted for export.
Of this, 1.2 million tonnes has already been exported in April and May and another 1.1 million tonnes is expected to be sent, Commerce Secretary BVR Subramaniam said.
He said that if an exporter had “a valid order – an unchangeable letter of credit – that agreement would be respected. Thus, India’s credibility as a reliable supplier would be maintained”.
Dr VK Vijayakumar, chief investment strategist at Geojit Financial, said: But unexpected heat waves have affected production, triggering rising wheat prices. ”
As inflation stood at 7.79 per cent in April and food inflation is emerging as a major concern at 8.38 per cent, controlling the domestic price of wheat should be given priority over target export earnings, said market analyst Dr VK Vijayakumar in his remarks. .
He added, “This could be problematic for long-term exports which require stability in policy. However, controlling domestic prices while ensuring adequate availability should be the current priority. ”
(With PTI input)