India is negotiating a major deal with Russia. India needs from three to four million tons of wheat, but New Delhi is ready to buy up to nine million tons of grain from Russia, Reuters reports.
Store is no sore. With stocks of wheat available, the Indian authorities will be able to exert a much greater influence on prices of essential goods in the country.
The decision will be made "cautiously, Reuters said. The deal is said to be concluded between the government and private companies.
In the even the agreement is achieved, it is private companies that will be engaged in purchases of grain. The Indian authorities do not want to participate in such a landmark deal directly because of US and EU sanctions.
Western sanctions do not affect Russian food supplies to world markets, Western officials and politicians assure. At the same time, the authorities of such a large country as India are looking for options to avoid extra problems.
An unnamed official said that Russia was ready to give India a discount on market prices for wheat.
"India can easily get a discount of $25 to $40 a tonne from Russia. This ensures that the cost of unloading wheat remains well below local prices," a Mumbai grain dealer told Reuters.
As of August 1, wheat stocks in India amounted to 28.3 million tons, which was 20 percent less than the ten-year average. India last imported wheat in 2017, when the country purchased 5.3 million tons from private traders.
In early August, Indian publication The Economic Times reported that the authorities of the country were considering a possibility of buying wheat from Russia in large quantities — about nine million tons.
The Indian government introduced wheat storage restrictions for manufacturers and suppliers involved in wholesale and retail trade.
This is the first time such restrictions have been introduced since 2008. India's Ministry of Consumer Affairs said that the measures were taken to ensure food security, stabilise prices, fight inflation and speculation. The restrictions caused wheat prices in India to rise.
It is worth noting here that grain exports from the Russian Federation in 2021-2022 agricultural year amounted to 38.1 million tons, including wheat exports — 30.7 million tons, Russia's Ministry of Agriculture said.