labels: economy - general, agriculture
Wheat exports banned to curb inflation news
14 February 2007

New Delhi: In an anti-inflationary crackdown, the government has imposed a complete ban on export of wheat and allowed free imports of maize.

The directorate general of foreign trade in the commerce ministry has notified that ban on all varieties of wheat, including durum and seeds, would remain in force till the end of 2007.

The wheat crop for this season is estimated to be 72.5 million tonnes, a marginal increase over last year''s production of 69.5 million tonnes.

Though there were negligible exports of wheat in 2005-06, the ban is meant to ensure that the Food Corporation of India (FCI) would have sufficient stocks this year.

FCI''s procurement had seen a sharp decline last year at 9.2 million tonnes from 14.8 million tonnes the previous year, forcing the government to go in for imports.

The free import of maize is likely to check the rise in prices, which has been triggered by increasing demand from the poultry industry and low production.

The government and reserve bank have in the recent past unleashed a number of steps to curb inflation and money supply.

On Tuesday, the RBI hiked the cash reserve ratio by a half per cent to six per cent to control money supply in the banking system — a move to curb credit flow.

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Wheat exports banned to curb inflation