India’s wheat export ban raises concerns in US and Europe

Since the start of the war in Ukraine last February, India has been increasingly at odds with the United States and its Western allies. Initially it was New Delhi’s refusal to name Russia as the aggressor in Ukraine and now the focus is on India’s decision to ban wheat export at a time when the world is making facing a massive shortage triggered by the fighting in Ukraine.

The global food shortage and rising food prices will figure prominently at the Quad Summit in Japan next week. Although the Quad is primarily focused on the Indo-Pacific, the current concern over a major food shortage will be part of the conversation when Prime Minister Narendra Modi meets President Joe Biden and the leaders of Japan and Australia. Biden is likely to urge Modi to reconsider his ban on wheat exports.

India‘s move has not gone down well in Washington and several other Western capitals. Many remember New Delhi’s Covid-19 diplomacy when India, which boasted of being the pharmacy of the world, was unable to deliver on its commitments, thanks to the second wave of coronavirus which devastated the country. Today, the wheat export ban raises questions from the international community.

But unlike stopping Covid-19 vaccines as India itself faced a major health emergency, New Delhi is not in a similar stance on wheat. The government is being cautious mainly because unseasonable hot weather in March and April will likely lead to lower production. New Delhi can modify the decision if necessary in cases where agreements are already signed. It has already been done.

Yet the ban is in place and there are whispers in the West about whether India can be trusted to fulfill its responsibilities as a global partner. In fact, at a recent meeting of G-7 agriculture ministers, India was criticized for its decision to ban exports. The German minister urged India to assume its responsibilities as a member of the G-20. Linda Greenfield Thomas, the US envoy to the UN also criticized India saying the US wants New Delhi to reconsider the decision.

“We have been extremely clear that the principle and need for food security in India is paramount to us. Yet, at the same time, we have been very careful and calibrated to ensure that the needs of economies vulnerable to food security risks are met as far as possible,” Foreign Minister Vinay Kwatra said during a briefing on Saturday. briefing on Modi’s visit to Japan.

The government is clear that while its priority is above all to feed its people, it will also try to help countries in need wherever possible.

India’s ban on wheat exports last week led to a sharp spike in prices on the international market. Washington is said to be concerned about New Delhi’s move, especially as Modi earlier signaled that India – the world’s second largest wheat producer – would shore up its wheat exports and stabilize the global market which has seen a sharp surge. price increase after the Ukrainian war.

Russia and Ukraine are together the largest wheat producers in the world. India is the second. But supplies from Russia and Ukraine have been cut off due to the war which has raised fears of a massive global grain shortage.

New Delhi’s announcement last week surprised the world as it had previously indicated otherwise. During the India-US summit held with the 2+2 meeting in Washington in April, Modi had promised Biden that if the World Trade Organization allowed it, India could export wheat grains in the whole world.

Finance Minister Nirmala Sitharaman told World Bank and International Monetary Fund meetings in Washington that India was facing problems with the WTO because of its desire to export food grains. Again on April 25, Foreign Minister S Jaishankar talked about India helping the world with wheat export and price stabilization. Meanwhile, India had made deals with Turkey and Egypt to supply wheat. It was seeking deals with several African and East Asian countries like Thailand and the Philippines.

The United States was counting on India to fill part of the void. This sudden move by India to ban exports disappointed the Biden administration’s expectations of India. Initially, India seized the opportunity to increase its wheat exports. It is well known that India has massive stocks stored in the warehouses of Food Corporation of India and is committed to buying wheat donated by farmers every season. But an expected drop in production led the government to limit its exports.

Like all governments, the Modi government too must first ensure that its people already reeling from massive price hikes do not have to face the added burden of a staple being scarce. Surprisingly, China has backed India’s position at a time when bilateral relations are at an all-time low.

Last week’s Modi government order has since been partially amended to ensure that some of the already allocated wheat shipments are not turned back from ports. But the export ban remains.

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