Indian authorities are in the process of discussing with Russian partners the possibility of purchasing a significant quantity of wheat to reduce the cost of this product on the domestic market.
"The government is exploring the option of buying wheat from Russia through private companies or by entering into a bilateral agreement. The decision will be made cautiously," one source noted.
Another source emphasized that to cover the wheat deficit in the Indian market, around 3 to 4 million tons of grain are needed, but New Delhi is considering the purchase of 8-9 million tons of Russian wheat for a more significant impact on the price situation.
Sources from the Economic Times claim that the final decision on wheat procurement from Russia could be made in the coming weeks. The Indian government sees the possibility of wheat imports as one of the tools to curb the rise in food prices.
India significantly increased wheat imports last in 2017 when purchases amounted to 5.3 million tons.
Wholesale wheat prices in India have risen by about 10%, reaching a seven-month high in August due to limited stocks. As of the beginning of August, state wheat reserves stood at 28.3 million tons, 20% below the average level of the last 10 years.
The increase in wheat prices is also attributed to the government this year imposing restrictions on the amounts of wheat producers and suppliers can hold in stock for wholesale and retail sales. According to the Ministry of Consumer Affairs of India, such measures were introduced to ensure food security, stabilize prices, combat inflation, and speculation.
India is one of the world's leaders in milk, meat, and cereal crop production. At the same time, the country is the largest importer of vegetable oils in the world, as well as one of the main buyers of beans and lentils. In 2022, the total volume of agricultural imports into the country reached a record $34.1 billion. Russia ranked eighth among agricultural product suppliers.
