Indian bureaucrats like to claim – including at the World Trade Organization – that their restrictive trade policies are meant to protect our millions of subsistence farmers.
In practice, however, farmers are the last thing on policymakers’ minds. If agricultural income was the government’s number-one priority, it would not shut down exports just as prices are rising and farmers have an opportunity to make a rare profit.
DECISIONS HAVE GLOBAL RAMIFICATIONS
If India is to take on a leading role in the world, it must understand that its decisions have global ramifications. Even in richer countries such as the US, consumers – many from the Indian diaspora – have stampeded supermarkets in attempts to hoard various Indian varieties of rice.
Indian policymakers have their defence ready against such complaints. They will point out that the ban doesn’t extend to the most popular Indian variant, basmati. This will be little consolation to Indians abroad, particularly those from South India, who prefer shorter-grain varieties.
They could also, with perfect truth, point out that in spite of the ban on exports announced last year, India actually shipped out almost twice as much wheat during the summer of 2022 as it had the previous year. This wasn’t because of leakages in the system. Partly, it was because contracts signed before the ban were still fulfilled.
But it was also because other governments could lobby Indian officials to make exceptions for specific wheat shipments. A similar system will be put into place for rice.