Dhaka may get Delhi's quota promise for rice, wheat

Bangladesh has sought quota assurance from India to import a fixed amount of onion, lentil, sugar, garlic and ginger along with 65 lakh tonnes of rice and wheat each year to stabilise the market price of daily commodities in the country.

Ministry officials believe India will agree to the proposal and the announcement will be made on Tuesday.

The quota issue was discussed during Commerce Minister Tipu Munshi's visit to New Delhi last week after Prime Minister Sheikh Hasina's September visit.

Bangladesh had earlier sent a proposal on the minimum quantity of commodities that it wanted to import from India annually.

The Ministry of Commerce asked for a quota of 45 lakh tonnes of wheat, 20 lakh tonnes of rice, 7 lakh tonnes of onions, 15 lakh tonnes of sugar, 1.25 lakh tonnes of ginger, 30,000 tonnes of lentils and 10,000 tonnes of garlic, ministry officials said.

Commerce Minister Tipu Munshi could not be reached Monday for comments, however, Additional Secretary of the ministry Noor Md Mahbubul Haque, who accompanied the minister to India, told The Business Standard that the commerce minister will hold a press briefing on the matter on Tuesday and there would not be any comments before that.

In its national budget in March, India had announced the export quotas for various consumer goods to Nepal and Bhutan.

Dhaka expects that it would add the same quota privileges for Bangladesh in the next financial year.

Even if India imposes a ban on the export of a product during any crisis in its domestic market, the two countries can continue the import process based on the fixed quotas.

Commerce ministry officials said India had agreed to the quotas given the internal supply situation was normal.

Infographic: TBS

During the commerce minister's visit, there were also discussions on resolving bilateral trade issues, including withdrawing India's anti-dumping duty on Bangladeshi products, starting formal negotiations for the signing of the Comprehensive Economic Partnership Agreement, forming the CEO's Forum and removing the existing obstacles in border infrastructure development.

Bangladesh is highly dependent on India for daily necessities including rice and wheat.

In the past few years, India had imposed occasional temporary bans on the export of various products, such as onion, rice, wheat and sugar, due to domestic crises. The bans worsened market instability in Bangladesh.

Against this backdrop, Prime Minister Sheikh Hasina and Commerce Minister Tipu Munshi requested the Indian government to inform Bangladesh before stopping exports of any essential goods. Even then, India suddenly imposed export bans from time to time.

India banned wheat and sugar exports during the Ukraine-Russia war. Due to this, the price of flour and sugar in Bangladesh rose sharply.

India had also committed to exporting wheat on Letters of Credit, but this did not happen either.

Before the prime minister's visit to India last September, the Bangladesh High Commissioner in New Delhi met with the country's commerce secretary and expressed his disappointment over the Indian ban on the export of essential goods.

Then India's commerce secretary discussed setting quotas for exports to Bangladesh like it does for Nepal and Bhutan.

After discussing the matter during PM Hasina's visit, Dhaka sent a proposal on how much consumer goods Bangladesh wants to import from India every year.

The commerce minister returned to Dhaka on Thursday night after negotiations to obtain India's consent in this regard.

Businesses welcome the news

Business leaders have hailed the move to push for export quotas.

"If India stops exporting onions and wheat, it creates instability in the country's market. If a certain amount of imports is fixed every year, there will be no more crises and there will be food security. Besides, the import can be planned in advance," Harun-ur-Rashid, president of Hili land port import-export group, told The Business Standard.

Md Shafiul Ather Taslim, director, Finance and Operation of TK Group, a business conglomerate having vegetable oil business, said, "Some 25-30% of our imports come from India. If we have this assurance, import decisions will be a lot easier. We can be very independent even in a crisis and keep the supply chain in order. So, this agreement will play a very important role for us."

Taslim Shahriar, senior AGM, Meghna Group of industries, one of the largest business conglomerates, also hailed the move as a positive one which would help the country achieve food security.

Officials of the Ministry of Commerce said the Bangladesh Trade Negotiating Committee said India has agreed to the Commerce Minister's request to start negotiations in this regard at the earliest.

Bangladesh imported 11.57 lakh tonnes of wheat from India in the 2020-21 fiscal year, while it imported 16.23 lakh tonnes non-basmati rice from India.

Bangladesh onion imports were 6.59 lakh tonnes in 2020-21. Bangladesh imports 7-8 lakh tonnes of onions every year from India.