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NEW DELHI : In a sharp U-turn, the union government has banned wheat exports with immediate effect stating that a sudden spike in prices of wheat has sparked food security concerns in India and neighbouring countries. Wheat prices have been surging after the Ukraine war impacted nearly a third of the global exports.

Notably this comes barely days after the ministry of commerce and industry said it is set to send trade delegations to as many as nine countries to explore ways to enhance wheat exports. However, official numbers released on Thursday showed that India’s retail inflation jumped to its highest in nearly eight years.

“A sudden spike in the global prices of wheat arising out of many factors, as a result of which the food security of India, neighbouring and other vulnerable countries is at risk," the ministry of commerce and industry said.

Export of all varieties of wheat have been moved to the “prohibited" category, however, as per the notification issued, exports will be allowed on the basis of permission granted by the government to other countries to meet their food security needs and “based on the request of their governments".

Besides exports will also be allowed under transitional arrangements, where irrevocable letters of credit (ILOC) have been issued “on or before the date of this notification, subject to submission of documentary evidence as prescribed". ILOC is a guarantee for payment issued by a bank for purchases and cannot be cancelled during a specified time period.

India had planned to export 10 million tonnes of wheat during the ongoing financial year amid rising global demand for the grain globally, compared to the 7 million tonne (MT) of wheat it managed to export during 2021-22. Wheat exports in 2021-22 stood at $ 2.05 billion, official numbers showed.

However, heat waves had already forced the government to lower its wheat production estimates by 5.7% to 105 million tonnes from the projected 111.32 MT for the crop year ending June.

The India Meteorological Department (IMD) had issued a fresh heatwave warning till May 15 after similar warnings earlier this month. Weather experts warned that temperatures in parts of Rajasthan, Gujarat and Vidarbha may jump to 46-47 degrees Celsius due to the dry and hot westerly winds.

Commerce Minister Piyush Goyal in an interview with Mint in April had said that India is willing and ready to support any nation facing a scarcity of foodgrain and unavailability of adequate goods and services of any nature.

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