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Informist, Tuesday, May 6, 2025

 

By Pallavi Singhal

 

NEW DELHI – Extension of duty-free imports of yellow peas has helped tame prices, but the outlook for pulses inflation in the long term is firm, given the limited buffer stocks with the government amid weak procurement, according to CRISIL Intelligence Director Pushan Sharma. 

 

"Prices of pulses have declined sharply due to increased imports and a better domestic harvest," Sharma said. "However, despite the current softness in prices, the broader inflation outlook remains firm due to ongoing supply-demand imbalances and limited government-held stocks."

 

The government had imposed an import duty of 50% on yellow peas in November 2017. However, in early December 2023, to curb the rise in prices of pulses, the Centre allowed duty-free imports until March 2024. The permission has since been extended multiple times, with the current extension ending May 31.

 

Continued duty-free imports of yellow peas could help keep prices tamed, Sharma suggested. Yellow peas serve as an important substitute for chana in the Indian market. "With limited chana stocks and elevated prices, the likelihood of the government extending the duty-free import window for yellow peas beyond May 2025 is high. Such a move would help stabilise domestic supply and contain upward price pressure," he said.

 

According to Sharma, India's pulses imports surged to a nine-year high of 6.7 million tonnes in 2024-25 (Apr-Mar), driven by a favourable import policy and elevated domestic prices. "The government's move to maintain zero import duties on most pulses has helped stabilise supply and prevent price spikes," he said.

 

Yellow peas emerged as a key factor in this import surge, with volumes reaching 2.04 million tonnes in FY25 - 31% of the total pulses imports and the highest since FY18. "Yellow peas remain the most affordable imported pulse, with landed prices even lower than the minimum support price of key domestic pulses," Sharma said.

 

Rigorous policy interventions such as allowing imports of key pulses brought India's headline consumer price inflation to an over-five-year low in March, largely on the back of declining food inflation, with pulses inflation falling to (-)2.73%, the lowest since February 2019. Pulses inflation had been a major concern in the recent past, staying in double digits from June 2023 to August 2024.

 

Prices of tur and chana have dropped 20–22% and 14–15% year-on-year, respectively, largely due to strong imports and improved domestic production, according to Sharma. 

 

Informist had exclusively reported that as of Apr. 29, the government procured only 670,000 tonnes of pulses, including tur, chana, masur, and moong in the kharif marketing season 2024-25 (Oct-Sept), 13% of the total quantity of 5.08 million tonnes approved for procurement. The biggest lag has been seen in chana procurement, as prices of the commodity remain above the minimum support price. As of Apr. 30, only 40,000 tonnes of chana had been procured.

 

While year-on-year comparisons reflect a price decline due to last year's high base, prices are expected to remain 17–21?ove the five-year average, according to Sharma. "This suggests that the long-term price outlook for pulses is still firm."

 

Looking ahead, Sharma expects pulses inflation to remain low in the short term, supported by robust imports and a healthy domestic harvest. "But inflation may not decline much further, given limited buffer stocks resulting from weak procurement," he said.  End

 

Edited by Avishek Dutta

 

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