The Government has imposed basic customs duty of 10% on wheat till March 2016 under Section 159 of the Customs Act 1962. This step has been taken in order to curb shipments and liquidate poor quality grains lying in Food Corporation of India (FCI) godowns.
Despite bumper domestic wheat output in 2014-15 crop year and surplus stocks with the FCI, the nodal agency for procurement and distribution of foodgrains, private traders are importing the grains on back of lower global prices and lack of high-quality grains in the domestic markets.
Wheat production in India, the world’s second biggest grower, is estimated to have declined to 90.78 million tonnes in 2014-15, as against the record production of 95.85 million tonnes during 2013-14.