Govt slaps 10% import duty on wheat, tur dal to protect farmers' interest

The government on Tuesday re-imposed a 10-per cent import duty on wheat and tur dal with immediate effect, in a move to discourage import of these commodities following higher domestic production.

The government has now further amended a notification dated 17 March 2012 so as to "impose basic customs duty of 10 per cent on wheat and tur, with immediate effect," minister of state for finance Arjun Ram Meghwar said.

He said the move, while discouraging imports of the two commodities will generate an estimated Rs840 crore in additional revenues at current level of imports.

Minister of food and consumer affairs Ram Vilas Paswan had last week said that the government wanted to bring back import duty on wheat to protect farmers' interest.

Meanwhile, India's wheat imports are expected to slow after March on changes in fumigation rules.

In 2015, the government had imposed a customs duty of 25 per cent on wheat, which was subsequently cut to 10 per cent and totally removed in December last year.

The duty was cut following fears of a spike in prices as wheat output had dropped due to hail storm, he said, adding the crop production this year has been at a record 96.64 million tonnes. Besides there is also a 6.5-million tonne stockpile.

Private traders had bought more than 5 million tonnes of wheat in overseas markets following the lifting of import duty on such imports since mid-2016 to meet a supply shortfall left by two years of drought.

Most flour millers and biscuit makers imported wheat from France, Ukraine and Australia.

Both large imports and forecasts of a bumper crop prompted the government to impose the tax, the sources said.

The farm ministry last month forecast wheat output at 96.64 million tonnes in 2017, up from 92.29 million tonnes last year.