Caution, not exuberance

Caution, not exuberance
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First Published: Thu, Apr 24 2008. 12 31 AM IST
Updated: Thu, Apr 24 2008. 12 31 AM IST
With reports of a bumper wheat crop, agriculture minister Sharad Pawar has summoned the courage to say India will require no grain imports this year and may even be able to save some for next year.
His statement comes a day after the release of the third advance estimates for the rabi crop. Perhaps, he should be more cautious. Last year, too, India had a “bumper” crop of 75 million tonnes of wheat. The results of that bounty, though, were somewhat different. In spite of that, wheat prices, as reflected in the Wholesale Price Index, rose by 5.6% in early April compared with the same period last year.
It may be that minister Pawar’s confidence stems from the slew of administrative measures put in place to garner wheat by government agencies such as the Food Corporation of India. The sure test of their efficacy will be a fall in wheat prices. That will be known only after some time. Given the insatiable demand and speculative investment in commodities, he may have to eat his words at a later date.
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First Published: Thu, Apr 24 2008. 12 31 AM IST
More Topics: Commodities | Wheat | WPI | Sharad Pawar | Views |