India`s wheat export ban - Is it in right direction?

Having built up 3 major global marketing bases from India in chemicals, metals, and telecom cables businesses, one of the questions that I was constantly asked was whether Indian companies will prove to be reliable and consistent suppliers over a long term in the international markets.

In all products that I dealt with, due to import duty benefits in India, profitability from the domestic market was higher than the international markets.

Secondly, with the Indian market size growing normally every year, allocation to international markets was always under pressure every year.

Thankfully, all the businesses that I built up have sustained over the last many years.

The Indian government has been highlighting India`s exports crossing $400bn in the last fiscal year. If India has to sustain this performance consistently, Indian companies will have to prove themselves to be reliable and consistent suppliers over a long term.

In this background, the Indian government`s decision to ban wheat exports isn’t in the right direction. This move by the Indian government to curb exports will have the following repercussions-

1. Construed as a bad signal for India`s global market ambitions. True, it was done to ease inflation, but a phased movement to curb exports would have been better.
2. Detrimental to its ambitions as a global superpower and playing an influential role in global politics.
3. Indian Government could have used these high export prices to push through the contentious “Farm Laws” with the farmers' unions, as Indian farmers were earning more by selling to private exporters, which was exactly the basic motive of the farm laws.

Indonesia, a global major in the palm oil business, should be taken as a cue. It had banned exports for a short period of time but reversed the ban as prices cooled off and she was earning a bad reputation in the global market.

I sincerely hope that the wheat exports ban is revoked by the Indian government in a short time as prices cool off in Indian markets. Hopefully, good monsoons will provide the much-needed boost to wheat production.

I also hope that structural reforms are ushered in the agriculture sector to make India a global major in the international food supply chain.

Invite critical views and thoughts.