labels: economy - general
No cut in wheat import duty for private traders, says governmentnews
31 August 2006

Mumbai: Wheat import duty for private traders will continue at the existing rate of five per cent and the government has no plans to further cut import duty rates for private trade, a senior finance ministry official said.

"We have no plans to cut import duty on wheat as of now. We will review the situation in December," the official said.

In June, the government slashed customs duty on wheat imports by private flourmills and traders to five per cent from 50 per cent even as the country''s food stocks continued to plunge. India''s food stocks stood at 7.33-million tonnes on August 1, down from 12.9-million tonnes a year ago.

Traders demanded that they should be allowed to import wheat at zero duty, the rate at which the State Trading Corporation imports on the government account for the public distribution system.

The STC is proceeding with a fresh tender for purchase of 1.67-million tonnes of wheat over and above the 3.83-million tonnes it contracted since March this year.

The government had, earlier this week, allowed import of an additional 20-lakh tonnes of wheat at zero customs duty as part of measures to meet the shortfall in procurement of wheat for public distribution. The imports are being handled by STC and will continue till February 28, 2007.

The government has also allowed state governments to put caps on the amount of wheat and pulse stocks individuals or traders can hold in order to stop hoarding.

Wheat prices have been rising due to poor output while pulses prices have been rising because of a shortage in supplies from a major exporting country.

The cabinet also lifted all restriction on inter-state movement of cereals and pulses.

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No cut in wheat import duty for private traders, says government