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Big Boost for Grain Exporters: Centre moves wheat, flour, semolina to 'free' category'—Explained


Big Boost for Grain Exporters: Centre moves wheat, flour, semolina to 'free' category'—Explained

The central government on Monday removed certain export restrictions on select wheat products, such as wheat flour (‘atta’), semolina (‘suji’) and refined flour (‘maida’). The items were moved to the ‘free’ category from ‘prohibited’, allowing outward shipments with immediate effect.This marks reversal from a 2022 policy that banned certain wheat exports, citing availability and price pressures, in a bid to tackle domestic food inflation as parts of its broader efforts to safeguard national food security during global supply chain disruptions. A harsh heatwave that year had dented expected wheat yields just as global prices surged during the Russia-Ukraine conflict.A record wheat production over the past few cycles has since boosted government reserves of the crop, with food security risks subsided by domestic stocks well above mandatory buffer norms. Easing wheat inflation is viewed as giving policymakers room to open up international trade without risking local price spikes.According to a notification by the Ministry of Commerce and Industry’s Directorate General of Foreign Trade (DGFT), wheat flour and related products have been moved from ‘prohibited’ to ‘free’. The policy shift is set to impact the following wheat items:HS Code 10011900: Durum wheat (other)HS Code 10019910: WheatHS Code 11010000: Wheat or meslin flour (atta), maida, semolina (rava/sooji), whole-meal atta and resultant attaIndia achieved record food grain production this year, with total output for 2025-26 estimated at 376.563 million tonnes, nearly 18.8 million tonnes higher than the previous year.Earlier this year, the central government reiterated that the country’s food security, improving farmers’ livelihoods and providing nutritious food to citizens remain its highest priorities.Why governments restrict crop exportsAuthorities step in with export restrictions on select crops from time to time, especially when domestic food security, local prices or public stocks hit a rough patch. The underlying logic is simple: keep more produce within the country, boost local availability, and cushion households from the worst of global price spikes.These interventions usually target core staples, such as wheat, rice, maize, edible oils, sugar, or pulses. Typically, these are staple items that have a direct bearing on overall food inflation. Officials pull this off using tools ranging from outright bans and export quotas to minimum export prices, licensing needs or export duties. This helps them safeguard grain for public distribution, emergency reserves and welfare programmes.Export restrictions work as an emergency stabilisation tool -- not a long-term fix for crop forecasting, buffer-stock management, targeted support or predictable trade rules.Food inflation remains a key concernOfficial data released earlier this month showed retail inflation in the country accelerated to 4.45 per cent in July from 4.38 per cent the previous month. The pickup in inflation was driven by higher ​food prices, noted economists.That marked a second straight month when the overall Consumer Price Index (CPI)-based inflation reading stood above the RBI’s 4 per cent medium-term target even though it was largely along expected lines.During the month, food inflation climbed to 5.52 per cent from 5.32 per cent in the previous month, on the back of ​weak monsoon showers with sharp increases in ginger, garlic and onion prices offsetting declines in tomato prices.Economists expect food inflation to ease going forward with ​a recovery in seasonal rains that could mitigate price pressures from the impact of the El Nino weather phenomenon.

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