Liberalization of Wheat: Production, Prices and Trade

Abstract

The present study seeks to address the issues of opening-up of India's wheat imports as well as the relationship between production, government procurement, prices and imports of wheat. The authors find that the world wheat production has been continued to decline, while India's wheat production has been growing rapidly. The share of wheat in world total merchandise trade and in agricultural trade has been declining continuously. Further, results indicate that there is a strong and positive relationship between volume of GOI procurement of wheat and procurement price. Imports have failed to depress wheat prices substantially. Being a large country India's food security is more a function of harvest than that of volume of food imports. Thus, there is a strong case to devote more resources for increase in government procurement and production of wheat, in view of strengthening food security base of the country.