Diplomatic Strain Forces India to Cut Pulse Imports from Canada

The ongoing diplomatic tensions between India and Canada are prompting a significant shift in India's pulse import strategy. Following the tragic murder of a Canadian citizen in June 2023 and subsequent accusations by Canada against India, trade relations have deteriorated sharply. As a result, India is increasingly reducing its imports of two major pulses, lentils and peas, from Canada. Uncertainty over future trade relations drives this strategic move. Also the urgent need to secure more reliable sources of these essential commodities.

Embracing New Suppliers: Australia, Russia, and Türkiye

In response to the strained relations with Canada, Indian importers are turning to alternative suppliers in Australia, Russia, and Türkiye. The participation of Russia and Ukraine in the import of peas to India has been on the rise. While Türkiye is emerging as a key supplier as well. For lentils, Australia has already overtaken Canada. Australian lentils are expected to further increase their market share as Indian importers prefer them over Canadian ones. Additionally, American exporters are making concerted efforts to boost pulse exports to India, helping to mitigate the impact of reduced Canadian supply.

Surge in Pulse Import Expenditures Highlights

Import expenditures on pulses have surged by 73%, reaching $2.187 billion in the first half of the current financial year (April-September 2024), compared to $1.265 billion during the same period last year. In September 2024 alone, imports worth $425.78 million were recorded, a 34.8% increase from $315.89 million in September 2023. The first half of the financial year saw a significant rise in imports of tur, urad, and gram. It is driven by high demand and rising import prices. However, recent months have seen a slowdown in yellow pea and lentil imports. Because the domestic supply has improved, easing some pressure on import volumes.

Government Interventions and Market Adjustments

The Indian government has implemented several measures to support the pulse market, including duty-free imports of yellow peas from December 2023 and desi gram from May 2024. These steps are in response to declining domestic production, particularly for pigeon pea, and the steady demand. During April-September 2024, the import of tur is projected to rise to around 609,000 tonnes, more than double the 274,000 tonnes imported in the same period last year. Tur is primarily sourced from Myanmar and East African countries such as Mozambique, Malawi, Tanzania, and Sudan. Additionally, urad imports from Myanmar have become regular, with estimates rising from 240,000 tonnes to 408,000 tonnes.

Conclusion

India's strategic reduction of pulse imports from Canada. Escalating diplomatic tensions underscores the nation's resilience and adaptability in securing essential commodities. By diversifying import sources and enhancing trade with Australia, Russia, and Türkiye, India aims to stabilize its pulse supply chain and mitigate the impacts of geopolitical disputes. As diplomatic relations remain uncertain, India's proactive measures are set to reshape the pulse import landscape, ensuring continued supply and supporting domestic demand.





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