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Informist, Friday, Aug 16, 2024

 

By Pallavi Singhal

 

NEW DELHI – The government may remove 40% import duty on kabuli chana to maintain adequate availability of the commodity in the country, a senior government official said. The decision to remove the duty could be notified in the first week of September, according to the official. 

 

"Prices of the commodity have been ruling high despite several measures. There is high demand ahead of the festival season, making a case for prices to rise even higher. While the step is still under discussion, the rationale is to manage market sentiments and ensure availability," the official quoted above told Informist.

 

Prices of chana have seen a rise of 3% over the past two weeks. While its prices in Amravati, Maharashtra, had hovered between 7,250 rupees and 7,350 rupees per 100 kg on Aug 1, they were up at 7,450-7,575 rupees on Wednesday. A high demand for besan (gram flour) ahead of the festival season is pushing up prices of the commodity, chana traders said.

 

Even though India is a net exporter of kabuli chana, the government thinks that allowing free market dynamics to play out may actually help in this situation. "It does not matter even if a small amount is imported. What will matter is that traders know that cheaper supplies from other nations are freely available. This will not let some specific people manipulate the market," the official said.

 

India imports most of its kabuli chana from Sudan, Russia, and the US. According to commerce ministry data, India exported 99,157 tn kabuli chana in 2023-24 (Apr-Mar), and imported 93,648 tn of the commodity. The difference between exports and imports was starker in 2022-23, when the country exported 121,143 tn and imported 1,735 tn of kabuli chana.

 

On Jun 21, the government imposed stock limits on tur, chana as well as kabuli chana for retailers, wholesalers, and millers till Sep 30, to prevent speculation and improve affordability in domestic markets. In another order issued 20 days later, the government lifted the stock limits on kabuli chana.

 

"There has been ample discussion before every move. Stock limits were applied when we saw that the stocks declared by traders are much lower than the amount they should be at. They were lifted as we realised we are net exporters of the commodity," the official said.

 

A stock limit of 200 tn was imposed on wholesalers and 5 tn on retailers. For big chain retailers, the stock limit was set at 5 tn at each retail outlet and 200 tn at depots. For millers, the stock limit was set at the last three months of production or 25% of annual installed capacity, whichever was higher.

 

Moreover, importers were not allowed to hold imported stock beyond 45 days from the date of customs clearance. While removing the stock restrictions, the government said that it was optimistic about the production numbers of kabuli chana in the country.

 

Chana production for 2023-24 was pegged at 11.6 mln tn, lower than 12.3 mln tn a year ago, mainly due to erratic rainfall during last year's kharif season which delayed sowing of this rabi crop. An increase in the number of heatwaves days this summer also hit the harvesting of chana in India.  End

 

Edited by Aditya Sakorkar

 

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