New Delhi, January 15, 2024
Union Minister for Commerce, Piyush Goyal, declared on Saturday that the Government of India (GOI) has no intentions to lift the export restrictions imposed on wheat, rice, and sugar. Addressing reporters, Goyal emphasized that there is currently no proposal to remove the curbs, and he asserted that India does not have any plans to import wheat and sugar.
The government's decision to restrict exports of essential commodities was implemented as a measure to regulate domestic prices. Notably, India prohibited wheat exports in May 2022, halted non-basmati rice exports from July 2023, and extended restrictions on sugar exports beyond October 2023.
"There is no proposal as of now to remove export restrictions on wheat, rice, and sugar. And India will not import wheat and sugar," stated Minister Goyal.
In highlighting the government's commitment to supporting friendly nations, Goyal mentioned that India has been assisting with the food security needs of other countries. Notable exports include rice to nations like Indonesia, Senegal, and Gambia.
Economists have expressed differing opinions on the government's decision. Some view it positively, considering the challenge faced by the central bank in maintaining inflation within the tolerance band. Others, however, criticize the move as a "knee-jerk" reaction, suggesting the need for a more rational trade policy that balances the interests of both consumers and producers.
India's Retail Inflation Hits 4-Month High
Despite the government's efforts to manage essential commodity prices, retail inflation in India surged to a four-month high of 5.69% in December 2023, according to data released by the National Statistical Office (NSO), Ministry of Statistics and Programme Implementation (MoSPI) on Friday.
This marks the second consecutive month where the inflation rate exceeded the 4% mark set by the Reserve Bank of India (RBI) as its medium-term inflation target. In November 2023, India recorded a retail inflation rate of 5.55%.
In a positive development, the core inflation rate, which excludes fuel and food prices, showed a decline in December, settling at 3.89%. Economists are closely monitoring these figures as they gauge the impact of government policies on inflation and advocate for a comprehensive trade policy to address the concerns of various stakeholders.