Acloud of uncertainty hangs over the import of lentils from Canada, amid escalating diplomatic tensions between New Delhi and Ottawa.
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Industry insiders quoted in an Officenewz report said no new contracts for lentil imports from Canada are being signed, as importers fear potential retaliatory tariffs from either country. Earlier it was reported that India’s lentil imports from Canada had slowed due to the ongoing diplomatic row.
This is a potentially worrying development for both nations as Canada was the largest supplier of lentils to India in 2022-23. Imports from Canada accounted for over half of the country’s total lentil imports, which amounted to 4,85,492 metric tonnes.
At the same time, the development could negatively impact Canadian farmers. This is because any reduction in Indian purchases could lead to lower prices for Canadian farmers during the harvest season.
“There have been no new contracts for lentil imports due to the heightened diplomatic tension,” a senior executive from a major import-export firm told the business daily on condition of anonymity.
While no fresh contracts are being established, pre-existing contracts are still being honored, according to traders.
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Even then, the disruption in lentil supply could lead to a rise in inflation in India, especially at a time when pulses have become dearer due to production-related challenges.
It may be noted that inflation in pulses reached 13 per cent last month and was the highest among all other food categories, closely followed by cereals.
The discord between the two nations stemmed from Canadian Prime Minister Justin Trudeau’s allegations last month, suggesting that Indian agents may have been involved in the assassination of a Khalistani terrorist, Hardeep Singh Nijjar, on Canadian soil in June. India’s foreign ministry dismissed the allegations as “absurd.”
Amid the ongoing dispute, Canada has withdrawn 41 diplomats from India, and New Delhi has called on Ottawa to reduce its diplomatic presence.
So far, neither country has imposed tariffs to discourage trade. However, India has diversified its lentil imports, with Australia emerging as the primary beneficiary.
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Furthermore, India has recently fully exempted lentil imports from the US from any customs duties. Other destinations for lentil imports include Russia, Singapore, Turkey, and the UAE.
