Centre to find out why Turkey rejected wheat
Premium- ITC was unaware shipment would be sent to Turkey, says trade minister
India will investigate the reason behind Turkey rejecting a shipment carrying more than 56,000 tonnes of Indian Durum wheat, commerce and industry minister Piyush Goyal said on Friday.
“A country has rejected Indian wheat and we have started investigating the matter. But preliminary investigation suggests that the export belonged to ITC, which is known for its quality standards. ITC has sold the shipment to the Netherlands and the letter of credit (LC) also came from the Netherlands. Even ITC was not aware the shipment was due to be sent to Turkey," Goyal said.
On Friday, Mint reported that Turkey apparently rejected the shipment after it was found to have ‘Rubella’ virus, which, according to experts, develops owing to soil or seed contamination.
Goyal further said that the testing was done based on the requirements of the Netherlands, and the government isn’t aware of the “intent" of the country that rejected Indian wheat.
He added that Indian farm exports clocked a record high of $50 billion in the last financial year.
A government official said the reason behind Turkey rejecting India wheat could be political as India’s relationship with Turkey has deteriorated because of its support for Pakistan.
“There is a massive shortage of wheat globally, and we are getting queries regularly. Good if they don’t want Indian wheat, we have many more who understand the value of wheat at the moment," he said.
However, a trade expert who did not want to be named said he is hesitant to believe that Turkey’s rejection was based on political reasons as Indian farm exports get regular warnings from several countries.
“The government needs to address structural issues and solve the problem. During the 18 months from January 2020 to June 2021, the European Union raised 489 serious concerns over Indian agri exports. So are there political reasons behind these, too?" the expert asked.
In April, Mint also reported that the Indonesian Agricultural Quarantine Agency (IAQA) issued five non-compliances, three of which were related to dried red chillies, and two to peanuts.
“The WTO SCM (subsidies and countervailing measures) agreement clearly says that you cannot block a country’s consignment without scientific proof. So we have to understand what went wrong and we will have to find a solution," said Arpita Mukherjee, a professor at Icrier.
Another trade expert stated that it is important to know if the wheat shipment went to Turkey directly, because if it landed on a port in Netherlands, Indian authorities cannot be blamed.
He added that every country has its own set of quality guidelines.
It would be highly unusual if Turkey is rejecting shipments passed at a Netherlands port and an Indian port, he further added.
Meanwhile, the commerce and industry ministry had to issue warnings against traders who were trying to produce fake letters of credit dated before 13 May, the cutoff date when the wheat export ban was announced.
Government officials said traders have been trying to take advantage of high wheat prices in the international market by producing such fake letters of credit.
The price of EU Durum wheat in the international market is 39.5% higher than Indian wheat, according to data provided by the ministry of consumer affairs, food and public distribution.
“The price of EU Durum wheat in the international market is around ₹43 per kg, whereas Indian wheat is selling at an average price of ₹26 per kg wholesale. There is a price difference of ₹17 per kg, i.e. about a 39.5% discount to the international market. All other countries except India are selling wheat at around $450 to $480 per tonne," the ministry added.