Trade and industry are shocked by the government’s decision to impose a stock limit on pulses to send the ‘right’ signal to the market

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Trade and industry are shocked by the central government’s decision to impose a limitation on stocks of pulses for a period of 4 months. While the government said “the need for the decision was felt to send the right signal to the market”, traders and processors say there was no need to make the decision as prices are close to the levels minimum support price (MSP).

“In a constant effort to suppress the prices of essential commodities like pulses, the Government of India has issued a landmark order in which it imposed stock limits on pulses applicable to wholesalers, retailers, millers and importers,” says a government statement.

From July 2 until October 31, the stock limit will apply to all pulses except moong. Wholesalers can now have a maximum stock of 200 tons, while retailers have a cap of 5 tons. For processors, the inventory limit is equal to the last three months’ production or 25% of annual installed capacity, whichever is greater.

For importers, the stick limit will be 200 tonnes for sticks held before May 15. For inventory imported after May 15, the 200-tonne inventory limit will apply from the date of customs clearance.

Reacting to the government order imposing stock limits on pulses applicable to wholesalers, retailers and importers, Bimal Kothari, Vice President of IPGA, said, “The order imposing stock limits on pulses took the industry by surprise. This is a regressive step on the part of the government and will have serious repercussions not only on wholesalers, retailers and importers, but also on farmers and consumers. Farmers are going to be impacted negatively as it will be peak season for them with festivals around the corner and sowing time for kharif crops. Prices will collapse. Chana is already selling below the MSP. Tur and Urad sell at MSP. On the one hand, the government wants farmers to get the MSP and double their income, but this type of policy will hurt everyone and certainly benefit no one. »

The industry has claimed the move could lead to supply shortages during the upcoming festival season. “India needs 25 million tonnes of pulses every year. This year, a shortage is expected. Normally, an importer imports 3,000 to 5,000 tonnes of a variety, but imposing a limit of only 100 tonnes per variety will lead to controlling supplies. Such restrictions will do more harm than good to farmers and consumers. These limits will strangle supply as importers will not be able to import large quantities together. As the festival season is approaching from next month, supply could become a major constraint due to this restraining order. We urge the government to immediately withdraw the order as it is not in anyone’s interest,” Kothari said.

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