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Why Centre wants you to buy green peas at Rs 300 instead of Rs 30 a kilo

DGFT had on December 18, fixed an MIP of Rs 200 a kilo and restricted import only through Kolkata sea port for all four types of commonly used peas - yellow peas, green peas, dun peas, and kaspa peas

twitter-logo Joe C Mathew        Last Updated: January 11, 2020  | 09:44 IST
Why Centre wants you to buy green peas at Rs 300 instead of Rs 30 a kilo
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Don't be surprised if your favourite green peas (dry) start pinching your pockets very soon. You may even find it off the shelves of neighbourhood kirana stores once current stocks get exhausted as imports of green peas are not happening anymore, and local production is too little to meet demand.

What has caused dry green peas prices to increase (it is over Rs 100 a kilo now when landed cost of imported peas is in the range of Rs 30 - Rs 35 a kilo), and create the likelihood of further price rise or shortage of availability is a government decision to restrict its import by imposing a minimum import price (MIP) last month. The Directorate General of Foreign Trade (DGFT) had on December 18, fixed an MIP of Rs 200 a kilo and restricted import only through Kolkata sea port for all four types of commonly used peas - yellow peas, green peas, dun peas, and kaspa peas.

With an existing 50 per cent customs duty on peas, this notification effectively made it impossible to import peas below Rs 300 a kilo. "Of the 30 lakh tonnes of peas that are consumed in India, only five lakh tones are locally sourced. The rest is imported. Imports have stopped completely as it is not feasible to source it at that rate", says Pradeep Ghorpade, chief executive officer, India Pulses and Grains Association (IPGA). Incidentally, green peas is a niche even among peas' varieties that face import restrictions as its annual demand is approximately 2.5 lakh tonnes.

You may be wondering why the government should restrict import if there isn't enough local production and restrictions can only result in shortage and price increase. Well, the answer is simple. The notification was meant to protect domestic production, though not peas production. It was aimed at ensuring better price for another pulse, chana dal (chickpea) which when split and polished is as good and similar as yellow peas. The chana crop this time is expected to be very good due to sufficient rains and the restrictions are to ensure that chickpea farmers get fair and remunerative prices for their produce this season.

"If the concern was substitution of yellow peas with chana, why add green peas?" Ghorpade asks.  

The government intervention may have made green peas expensive, but there is no doubt that similar restrictions in the past and announcement of higher minimum support price for pulses have made India inch towards self-sufficiency in pulses production. From producing 19 million tonnes of pulses in 2013-14, production has grown to 23 million tonnes by 2016-17. From an import of 5.5 million tonnes of pulses in 2016-17, it has come down to 2.37 million tonnes in 2018-19.

The Pulses traders represented by IPGA wants the government to reconsider import restrictions on those items where local production is low, and ensure better procurement of locally produced pulses at government fixed minimum support price (MSP)  to maintain the price levels where production is high.

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