November 8, 2017 / 4:40 PM / a month ago

India doubles wheat import tax to 20 percent: govt order

NEW DELHI (Reuters) - India has doubled its import tax on wheat to 20 percent, according to a government order made on Wednesday, as the world’s second biggest producer tries to rein in imports to support local prices.

FILE PHOTO - A worker spreads wheat crop for drying at a wholesale grain market in Chandigarh, India, April 22, 2015. REUTERS/Ajay Verma

In the last two years India has been importing wheat after local production fell due to successive droughts. Indian farmers have started sowing new season wheat that will be ready for harvesting from March.

India had imported 5.75 million tonnes of wheat in the 2016/17 fiscal year ended on March.

The government on Wednesday also imposed 50 percent import tax on peas as prices of pulses fell below the government-set support level in the local market.

India imports peas mainly from Canada, Russia, United States and France. In 2016/17, India’s pea imports jumped 41 percent from a year ago to a record 3.17 million tonnes.

Imports of wheat are not possible with a 20 percent import duty and even overseas purchases of peas will slow in the coming months, Pravin Dongre, chairman of the India Pulses and Grains Association told Reuters.

“These are very good moves to support local prices and farmers.”

Reporting by Rajendra Jadhav and Mayank Bhardwaj; Editing by Greg Mahlich and David Evans

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