Economic Survey warns against knee jerk reactions to price rise of essential commodities


The Economic Survey has called for calibrated Import Policy and said that knee jerk reactions to price rise of essential commodities like pulses and edible oils through frequent import duty/tariff revisions though providing immediate relief to the consumers in the way of lower prices, send wrong signals to domestic producers and create an environment of uncertainty.

A long-term consistent approach is mandated, it said. A step in this direction has been taken by the government where five year MoUs have been signed with Myanmar for annual import of 2.5 LMT of Urad and 1 LMT of Tur, with Malawi for annual import of 1 LMT of Tur, and MoU with Mozambique for annual import of 2 LMT Tur has been extended by another five years.

These MoUs will ensure predictability in the quantity of pulses being produced abroad and exported to India, thus benefiting both India and the pulse exporting country, the Economic Survey said.

Encouraging farmers to shift from cultivation of rice and wheat to pulses and oilseeds would help ensure that the country is self-reliant in pulses and oilseeds and also assist in reducing import dependence, the Economic Survey for 2021-22 has prescribed.

Given the importance of supply-side factors in having a predominance in determination of inflation in India, long-term policies are likely to help, the Survey said.

A shift in cultivation towards pulses would also enable the government to maintain realistic buffer stocks of rice and wheat.

Recently, the government has been prioritising increasing production of pulses and oilseeds through area expansion, productivity through HYVs, MSP support and procurement.

Focus on transportation and storage infrastructure for perishable commodities has also been prescribed. Better storage and supply chain management is required to ensure availability in lean season and reduced wastages of horticulture and other perishable essential commodities to reduce the seasonal spikes in prices for consumers, glut for the farmers in times of good harvests due to lack of marketing infrastructure, resulting in distress sales.

Effective utilisation of Agriculture Infrastructure Fund for investment in viable projects for post-harvest management infrastructure for perishable commodities can help improve agriculture infrastructure in the country. Schemes like Operation Green and Kisan Rail need to be exploited further to protect the interests of the farmers as well as the consumers, it added.

(Sanjeev Sharma can be reached at



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