[Answered] Highlight the rationale behind India’s recent ban on wheat exports. Also, bring out its possible implications.

India was the world’s second largest producer of wheat with a share of around 14.14 percent in global wheat production in 2020. Annually, the country produces 107.59 million tonnes of wheat, most of which is used for domestic consumption (98 million tonnes). India is the world’s eighth largest wheat exporter and accounted for 4.1 per cent of total global wheat exports in 2020-21.

Rationale behind India’s ban on wheat exports:

• Scorching heatwaves in the country’s northern parts have curtailed wheat output. It is resulting in skyrocketed domestic prices. The decision was taken to manage India’s overall food security and to support the needs of the vulnerable and neighbouring countries.
• Some parts of India witnessed a jump in the prices of wheat and flour by 20 to 40 percent in recent weeks. Because of the sharp rise in global prices, some farmers were selling to traders and not to the government. This got the government worried about its buffer stock (already depleted by the pandemic) – needed for handouts to millions of poor families and to avert any possible famine.

Possible implications:

• Export ban may exert upward pressure on global wheat prices, which were already rising for other reasons.
• This export ban is a preventive step and may prevent local wheat prices from rising substantially; however, with domestic wheat production likely limited by the heatwave, local wheat prices are not moderate materially.
• It will be a loss for farmers as well because the market price of wheat had become higher than MSP. Many farmers preferred to sell in the market. It led to the highest purchase of wheat by private traders in Punjab in the last 8 years.
• In Asia, except for Australia and India, most other economies depend on imported wheat for domestic consumption and are at risk from higher wheat prices globally, even if they do not directly import from India.

In the present globalised market, events in one country can trigger multiplier effects worldwide. Most countries depend on each other, some for even meeting basic needs of food security. Climate change is not a concept, but a real issue that we are facing. The government has to push the ‘Lab-to-Land’ approach now and deploy techniques and technologies that would help farmers adapt to the changing climate.