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Topic : Agriculture may need a new export-import policy

GS-3 Mains : Economy

Revision Notes

Note : Kindly avoid Data Number

Overall Exports Down 8.2%: India’s agricultural exports fell to $48.82 billion in 2023-24, down from a record $53.15 billion in 2022-23 (Department of Commerce data).

Reasons for Decline:

    • Shipment curbs: Government restrictions on exports of various commodities like sugar, non-basmati rice, wheat, and onions due to concerns over domestic availability and inflation.
    • Increased import competitiveness: Lower global agri-commodity prices between 2013-14 and 2019-20 made imports more attractive, reducing India’s export competitiveness.

Impact of Export Curbs:

    • Sugar: Exports dropped to $2.82 billion in 2023-24 from a peak of $5.77 billion in the previous year due to a complete export ban implemented in October 2023.
    • Non-Basmati Rice: Exports fell to $4.57 billion from a record $6.36 billion in 2022-23 due to a ban on exports of all white non-basmati rice since July 2023 (only parboiled shipments allowed with a 20% duty).
    • Wheat: Exports plunged to $56.74 million in 2023-24 from an all-time high of $2.12 billion in 2021-22 after a complete stop on exports in May 2022.
    • Onion: Exports reached 17.08 lakh tonnes worth $467.83 million in April-February 2023-24 (compared to 25.25 lt for the whole of 2022-23) due to a May 4, 2023 export ban lifted just before elections, followed by a floor price and 40% duty.

Bright Spots:

    • Basmati Rice: Exports hit a new high of $5.84 billion in 2023-24.
    • Spices: Exports crossed $4 billion for the first time ever.
    • Other: Marine products, castor oil, and other cereals (mainly maize) also saw export growth.

Historical Context:

    • Exports declined during the initial years of the Narendra Modi government (2013-14 to 2019-20) due to a crash in global agri-commodity prices.
    • Global price recovery post-pandemic and the Ukraine war led to record highs for both exports and imports in 2022-23.

Vegetable Oil Imports Decline:

  • Vegetable oil imports dropped below $15 billion in 2023-24, compared to over $20 billion in 2022-23.
  • Lower global vegetable oil prices (FAO vegetable oil sub-index down from 168.5 to 123.4 points) due to post-war normalization contributed to the decline.

Pulse Imports Surge:

  • Pulse imports nearly doubled to $3.75 billion in 2023-24, the highest since 2016-17.
  • Reason for increase not mentioned in the passage.

Policy Issues:

  • Farmers and traders seek stable and predictable policies to manage risks.
  • Export bans/restrictions (like on wheat and de-oiled rice bran) hurt producers who invest in building markets.
  • Temporary tariffs instead of bans could be a more balanced approach.
  • Low/zero import duties on pulses contradict the goal of promoting domestic production of pulses and oilseeds.

Future Policy Considerations:

  • The new government post-election may need a more rational export-import policy.
  • This policy should balance the interests of producers and consumers, along with short-term and long-term goals for agriculture.


Source : https://indianexpress.com/article/explained/explained-economics/agriculture-new-export-import-9318675/

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