What Happened
- The government decided to maintain current import duty rates on pulses and extend the duty-free import period for tur (pigeon pea) and urad (black gram) to prevent price increases for consumers.
- Officials anticipate that an El Nino weather event could affect the upcoming monsoon, reducing domestic production of tur and urad, making continued duty-free imports necessary to bridge the supply gap.
- Kharif output of urad has been weaker than expected; the government has revised down the production target for Kharif pulses for 2025-26 to 7.74 million tonnes from higher earlier estimates.
- The target for pigeon pea (tur) was cut to 3.7 million tonnes from 4.65 million tonnes; urad target was cut to 1.51 million tonnes from 3 million tonnes.
- India sources duty-free tur imports under preferential trade arrangements: 2 lakh tonnes from Mozambique, 1 lakh tonnes of tur and 2.5 lakh tonnes of urad from Myanmar, and 50,000 tonnes of tur from Malawi under government-to-government agreements.
- Keeping import duties unchanged prevents retail pulse prices from rising, especially for protein-scarce lower-income households.
Static Topic Bridges
Minimum Support Price (MSP) and Pulses — India's Food Security Policy
The MSP for pulses is set annually by the government on the recommendation of the Commission for Agricultural Costs and Prices (CACP). The CACP considers cost of production, demand-supply conditions, domestic and international prices, and inter-crop price parity. For marketing season 2025-26, the MSP for tur was set at ₹8,000 per quintal (up ₹450 from 2024-25) and for urad at ₹7,800 per quintal (up ₹400).
- The CACP recommends a minimum 50% return over the cost of production (C2 cost) — the margin over cost for tur is approximately 59%, for urad approximately 53%.
- Budget 2025 announced 100% procurement of tur, urad, and masoor production for four years (2025-26 to 2028-29) to boost farmer confidence.
- India covers 22 mandated crops under MSP, including all major pulses: tur, moong, urad, chana, masoor, and moth.
- Tension in price policy: High MSP for tur/urad is needed to incentivise production and achieve self-sufficiency, but duty-free imports suppress market prices, reducing the effective price farmers receive.
- NAFED and NCCF (National Cooperative Exports Limited) are the nodal agencies for procurement of pulses at MSP.
Connection to this news: Extending duty-free imports keeps retail prices stable but may undermine the effectiveness of MSP support for tur and urad farmers, highlighting the inherent tension between consumer welfare and farmer income goals.
El Nino, Indian Monsoon, and Pulse Production
El Nino is the warm phase of the El Nino-Southern Oscillation (ENSO) cycle, characterised by above-normal sea surface temperatures in the central and eastern equatorial Pacific Ocean. El Nino years typically correlate with below-normal monsoon rainfall over India (drought or deficient monsoon), while La Nina years are associated with normal or above-normal rainfall.
- India receives about 70-90% of its annual rainfall from the Southwest Monsoon (June-September), which is critical for Kharif crops including tur and urad.
- El Nino events that adversely affected Indian agriculture: 2002 (severe drought), 2009 (36% deficit monsoon), 2015-16 (deficient rainfall, led to kharif pulse shortfalls).
- Tur (pigeon pea) and urad (black gram) are predominantly Kharif crops, sown during June-July and harvested in October-November; they are rain-fed crops especially sensitive to monsoon distribution and quantity.
- The India Meteorological Department (IMD) and ICAR regularly update seasonal crop production forecasts based on ENSO conditions.
- A deficient monsoon can reduce pulse production by 15-30% in a single year, causing sharp retail price spikes, as seen in 2015-16 when tur prices crossed ₹200/kg in some markets.
Connection to this news: The government's anticipation of El Nino risk is driving the decision to lock in duty-free import arrangements for tur and urad ahead of the Kharif sowing season, providing a supply buffer against potential domestic production shortfalls.
India's Preferential Trade Arrangements for Pulses — Least Developed Country (LDC) Concessions
India provides zero or preferential import duty to goods originating from UN-designated Least Developed Countries (LDCs), under the Duty-Free Tariff Preference (DFTP) Scheme launched in 2008. Myanmar and Mozambique, both major pulse suppliers, benefit from this scheme. Additionally, India has specific government-to-government bilateral agreements for pulse imports to ensure assured supply volumes.
- India's standard import duty on pulses is 10% but this has been reduced to zero for specific sources and durations under government notifications.
- Under the preferential arrangement: 2 lakh tonnes of tur from Mozambique, 1 lakh tonne of tur and 2.5 lakh tonnes of urad from Myanmar annually.
- Malawi: 50,000 tonnes of tur under a separate bilateral arrangement.
- Total assured tur imports under preferential arrangements: approximately 3.5 lakh tonnes per year.
- Australia, Canada, and Tanzania are other significant suppliers of pulses to India.
- India is the world's largest producer and consumer of pulses, accounting for about 25% of global production and 27% of global consumption.
Connection to this news: The government's plan to keep duties unchanged and extend duty-free periods reflects a continuation of existing preferential trade frameworks for LDC supplier countries, maintaining supply security without incurring tariff policy disruption.
Key Facts & Data
- Kharif pulses production target (2025-26): 7.74 million tonnes (revised down)
- Tur target: 3.7 million tonnes (down from 4.65 million tonnes)
- Urad target: 1.51 million tonnes (down from 3.0 million tonnes)
- MSP for tur (2025-26): ₹8,000/quintal (up ₹450 from 2024-25)
- MSP for urad (2025-26): ₹7,800/quintal (up ₹400 from 2024-25)
- Duty-free tur imports: 2 lakh tonnes (Mozambique) + 1 lakh tonne (Myanmar) + 50,000 tonnes (Malawi) = ~3.5 lakh tonnes annually
- Duty-free urad imports: 2.5 lakh tonnes (Myanmar) annually
- Standard import duty on pulses: 10% (waived under duty-free notifications)
- El Nino correlation: Below-normal monsoon → 15-30% reduction in pulse production in bad years
- India's share of global pulse production: ~25%; consumption: ~27%
- CACP: Recommends MSP for 22 mandated crops; requires minimum 50% return over C2 cost