New Delhi, July 3 - The government today approved export of two million tonnes of wheat from its buffer stock in order to clear storage space for new crops.
The decision was taken by the Cabinet Committee on Economic Affairs (CCEA).
"CCEA has approved export of two million tonnes of wheat from government stock with floor price of USD 228 (about Rs 12,400) per tonne," Food Minister K V Thomas told PTI after the meeting.
The CCEA decided to immediately allow 90,000 tonnes of wheat export from the bids received by the state-run public trading firm STC in its recent tender.
For export of the remaining quantity, the CCEA has decided to set up a committee headed by Commerce Secretary.
Although Thomas said there is no subsidy or losses in wheat exports, sources in the ministry said the export of 2 million tonnes would involve an outgo of Rs 1,263 crore.
At present, the government is grappling with the problem of storage capacity. Its godowns are overflowing with a record 82 million tonnes of rice and wheat against the storing capacity of only 64 million tonnes.
To clear surplus stock, the Food Ministry has proposed export of 2 million tonnes of wheat stored in the Food Corporation of India (FCI) godowns, as recommended by the PMEAC Chairman C Rangarajan.
India, the world's second largest producer of wheat, had harvested a record 90.23 million tonnes in the 2011-12 crop year (July-June), leading to a record procurement of nearly 38 million tonnes so far this year.
In September last year, the government allowed wheat exports through private trade. Since then about 1.3 million tonnes have been exported. PTI