The Hindu Business Line : Did Pawar jump the gun on wheat imports?

The Centre has notified the nil customs duty for wheat imported on private account. The reduction in duty from 5 per cent to zero, notified by the Department of Revenue on Saturday, is applicable till December 31.

According to a Finance Ministry release, the Cabinet Committee on Prices (CCP) had, on August 31, decided to notify the zero duty after the State Trading Corporation of India (STC) concluded its wheat import contracts, for which the tenders were opened at 3 p.m. on September 5. Since the wheat import contracts for 16.7 lakh tonnes (lt) were finalised on Saturday, the notification was accordingly being issued.

Interestingly, while the release mentioned about the CCP's decision not to notify the zero duty till STC had concluded the import contracts — presumably not to influence price bids by international suppliers — the Union Agriculture Minister, Mr Sharad Pawar, had himself announced the lifting of the duty on September 4. This was a day before bids for the tender were opened.

Meanwhile, STC had awarded contracts for the entire 16.7 lt wheat, for which it had floated a tender on August 30. Of the total, Glencore International AG of Switzerland would supply 6.8 lt, including 3.5 lt for $231 per tonne at Kandla port (cost plus freight), two lt for $232 per tonne at Vizag and 1.3 lt for $223 per tonne at Mundra.

The second largest supplier is Australia's monopoly wheat exporter AWB Ltd, which would deliver 3.9 lt at Mundra for $226 per tonne and 2.05 lt at Chennai for $238 per tonne, taking its total to 5.95 lt. Toepfer International of Germany has bagged a contract for 2.6 lt, to be supplied at Mundra for $224.27. The balance 1.35-lt order is to Concordia Agritrading Pte of Singapore, which is shipping the whole quantity to Kandla at $228-229 per tonne.

With this, STC has now finalised total imports of 55 lt on behalf of the Government through five tenders. In its first tender floated on February 10, the parastatal contracted 5 lt of wheat at $178.75 c&f.

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Did Pawar jump the gun on wheat imports?