While the war goes on between Russia and Ukraine, there is a good opportunity for India to export wheat. But the West may create hurdles in it. These countries have for long believed that the Minimum Support Price (MSP) offered on food grains in India goes against the WTO’s (World Trade Organisation) principles, especially when it comes to exports.
Russia and Ukraine are major producers of wheat. Their share in total global exports of wheat goes up to about 30 per cent. It will soon be wheat sowing season in Ukraine, but the war conditions have rendered the sowing unlikely.
On the other hand, India has sufficient stock of wheat. The Ministry of Agriculture has estimated a production of 11.13 crore tonnes of wheat this year, which will be an all-time record. Last year, the wheat production was 10.92 crore tonnes. India stands second in global wheat production with a 13.5 per cent share.
Wheat export from India has gone up, too, over the last few months. During April-December 2021, the quantity of wheat exported was 50 lakh tonnes, five times what it was the previous year. India has a good opportunity to increase its export this year in view of the record production and the international market situation.
Currently, a large part of the wheat production in India is domestically consumed, resulting in less than 1 per cent share in the total global wheat exports. With a view to the rise in wheat demand in the global market, the prices have gone up in the domestic market, too, by up to Rs 400-500 per quintal and are above the MSP.
Tea export also likely to be affected
There is an apprehension that tea exports to Russia and other CIS (Commonwealth of Independent States) countries may get affected due to war. India exports 6-6.5 crore kg of tea per annum to these countries. Exporters will find it most difficult in exporting to Russia. The US and western European countries have banned Russia and Belarus from SWIFT, making it difficult for countries to make payments to Russia and vice versa.