Yellow Peas Imports: A Speed Bump on India's Road to Pulse Self-Sufficiency?

India, the world's largest producer, consumer, and importer of pulses, faces a delicate balance between ensuring domestic availability and supporting farmer interests. Yellow peas, a pulse variety not widely grown domestically, have become central to India's policy debates on self-sufficiency. The decision to allow yellow pea imports has sparked concerns about whether it undermines the dream of becoming self-sufficient in pulse production. This article delves into the implications of importing yellow peas, examining whether it ultimately benefits or harms India's agricultural goals.

Historical Context of Yellow Peas Import Restrictions

India's journey with yellow pea imports has seen multiple changes, driven by government efforts to manage domestic pulse prices and protect farmers.

Before 2017: India allowed unrestricted yellow pea imports, which became popular due to their low cost compared to other pulses like chickpeas or pigeon peas. Imports surged, making yellow peas a preferred option for food processors, particularly in producing snack foods and besan (gram flour). The higher imports helped cushion domestic supply pressures and stabilize consumer prices.

In 2017: The government imposed restrictions on yellow pea imports to support domestic pulse farmers, including an annual quota and imports allowed only through a notified process. This move was prompted by a steep surge of cheaper imports, threatening farmer incomes and hindering self-reliance in pulses.

In 2019: The import policy was revised to allow imports with a restriction of Minimum Import Price (MIP) of INR 200 CIF, and imports were permitted only through Kolkata port. These restrictions remained in place for several years, signaling the government's focus on reducing dependency on imports and supporting domestic production.

Impact on Pulse Production

These measures aimed to reduce dependency on imported pulses and encourage domestic pulse production. The impact was significant: pulses production jumped from 21.5 million tons (MMT) in 2017-18 to 27.5 MMT in 2022-23. The import of yellow peas dropped from 2.5 MMT in 2016-17 to less than 0.15 MMT in 2018-19. During the same period, chickpeas production increased from 7.1 MMT in 2016-17 to 11.2 MMT in 2018-19, and yellow peas production increased from 0.24 MMT to 0.5 MMT. However, India's weather-dependent agriculture and inconsistent yields often resulted in shortfalls, making it challenging to sustain this protectionist stance.

Recent Developments: In recent times, the government relaxed its stance on yellow pea imports due to rising pulse prices and production shortfalls, especially for desi chickpeas and pigeon peas. In December 2023, the government allowed yellow pea imports for a period up to 31st March 2024. Subsequently, multiple extensions were provided, with the last extension allowing free imports of all yellow pea cargo with bill of lading on or before 31st December 2024.

The Flooding of Yellow Peas in Markets

Since the opening of imports, the market has been flooded with yellow peas. Estimates suggest that 2.4 million tons of yellow peas have been imported since the easing of restrictions, with an additional 0.5 million tons expected by the end of the exempted period. This significant inflow of yellow peas has put pressure on domestic pulse farmers and raised questions about India's commitment to achieving self-sufficiency in pulses.

The Self-Sufficiency Challenge

India's ambition to achieve self-sufficiency in pulses is well-founded, given the essential role of pulses in the Indian diet and the vulnerability of domestic prices to global market fluctuations. Pulses are a major source of protein for the majority of the population, especially for those who follow plant-based diets. Despite being the largest producer of pulses globally, India continues to rely on imports to meet growing domestic demand, creating a paradox that policymakers have struggled with for years.

Achieving self-sufficiency in pulses offers numerous benefits, such as reducing dependence on volatile international markets, stabilizing domestic prices, and improving farmer incomes. However, attaining this goal has not been without significant challenges. Indian agriculture is heavily reliant on monsoon rains, making pulse production highly vulnerable to erratic weather conditions. Moreover, fluctuating market prices and inadequate support infrastructure, such as irrigation facilities and storage, further complicate the path to self-sufficiency.

The government has made several efforts to boost domestic pulse production, including increasing the minimum support price (MSP) for pulses, offering subsidies for high-quality seeds, and promoting research into high-yielding and drought-resistant varieties. Despite these initiatives, domestic production has often fallen short of targets, especially during years of poor monsoon rainfall. This has necessitated imports to bridge the gap, with yellow peas emerging as one of the key imported varieties.

Economic Appeal of Yellow Peas Imports

Yellow peas hold significant economic appeal in the Indian market, primarily because they are cheaper compared to other popular pulses like chickpeas, pigeon peas, and lentils. For low-income consumers, yellow peas serve as an affordable substitute, helping to meet nutritional needs without straining household budgets. The affordability of yellow peas has made them a popular choice for various food manufacturers as well, who use them as an ingredient in processed foods, contributing to cost reductions across the value chain.

The import of yellow peas also plays a role in controlling retail prices, particularly during times of domestic supply shortages. For traders, importing yellow peas offers an opportunity to bridge the gap between production and demand, thereby mitigating price volatility. The government's decision to allow imports is often viewed as a measure to prevent runaway inflation in the prices of essential food items, particularly pulses, which are a dietary staple in India.

However, the economic rationale for allowing yellow pea imports must be weighed against the potential negative impact on domestic production. When cheap imports flood the market, they tend to drive down the prices of locally produced pulses. This situation disincentivizes farmers from investing in pulse cultivation, thereby hindering the long-term goal of achieving self-sufficiency. Thus, the decision to allow imports must be carefully calibrated to ensure that it does not undermine the interests of domestic farmers.

The Pushback Against Self-Sufficiency

The import of yellow peas, despite its short-term economic benefits, raises significant questions about India's long-term goal of self-sufficiency in pulses. Imported yellow peas often come at a lower price compared to domestically grown pulses, which can have a dampening effect on local prices. This price pressure discourages farmers from growing pulses, as they struggle to compete with cheaper imported varieties. When imports flood the market, farmers may find it challenging to secure fair prices for their produce, leading them to switch to other, more lucrative crops.

The frequent changes in import policies also create uncertainty for farmers. In one year, they may be encouraged to plant more pulses due to favorable government policies, only to find themselves competing with an influx of imported pulses the following year. This inconsistency undermines farmers' confidence in making long-term investments in pulse cultivation. As a result, farmers are often hesitant to expand pulse acreage or invest in improved farming practices, which ultimately impacts domestic production.

The impact of yellow pea imports is not limited to price suppression. The high import volumes and resultant low market prices have discouraged farmers from sowing pulses during current rabi (winter) season and sentiment is expected to sustain in kharif (summer) season as well. The inconsistency in pricing and the unpredictability of government policies have made pulse cultivation a risky proposition for many farmers, particularly smallholders who are already vulnerable to market fluctuations.

The Way Forward: Balancing Imports and Domestic Production

The debate surrounding yellow pea imports highlights the broader challenge of balancing consumer interests with those of farmers. On the one hand, ensuring affordable prices for consumers is crucial, especially in a country where a large segment of the population is food-insecure. On the other hand, promoting self-sufficiency in pulses is essential for the economic well-being of farmers and for reducing dependency on global markets.

To achieve this balance, the government must address the structural challenges faced by pulse farmers. Investments in infrastructure, such as irrigation systems and storage facilities, are critical to reducing the risks associated with pulse farming. Enhancing access to quality seeds and promoting mechanization can also help reduce production costs and improve yields. Moreover, a stable and predictable policy environment is key—frequent changes in import policies create volatility that affects both farmers and traders.

The government could also explore promoting the domestic cultivation of yellow peas in suitable agro-climatic regions. While yellow peas are not traditionally grown on a large scale in India, there is potential to promote their cultivation with targeted incentives and support. By encouraging domestic production of yellow peas, the government could reduce the need for imports over time, while also diversifying the pulse production base and providing farmers with an additional income source.

Technology can play a significant role in achieving self-sufficiency in pulses. The adoption of precision agriculture techniques, improved weather forecasting, and data analytics to predict market trends can all contribute to enhancing productivity and profitability for pulse farmers. Additionally, integrating digital tools and platforms to provide farmers with real-time information on market prices, weather conditions, and best practices can help them make informed decisions and improve their resilience to market shocks.

The government should also consider establishing clearer criteria for when imports will be allowed, based on specific market conditions. Such a policy framework would help reduce uncertainty and enable farmers to plan their crop cycles more effectively. Import restrictions alone are insufficient to achieve self-sufficiency—what is needed is a comprehensive approach that supports farmers in overcoming the inherent challenges of pulse cultivation.

Conclusion: A Delicate Balancing Act

The decision to allow yellow pea imports reflects the complex dynamics at play in India's pulse sector. While imports provide a quick solution to address supply shortages and control prices, they also pose a challenge to the country's long-term goal of self-sufficiency in pulses. The key to resolving this dilemma lies in striking a balance between meeting the immediate needs of consumers and creating a supportive environment for domestic farmers.

Yellow pea imports should be viewed as a temporary measure to address specific market conditions. The focus should remain on building the resilience and capacity of India's pulse sector so that, in the long run, the country can meet its pulse requirements domestically, ensuring both food security and the prosperity of farmers. By addressing the structural challenges faced by pulse farmers and promoting a stable policy environment, India can reduce its dependency on imports and move closer to realizing its vision of self-reliance in pulse production.

Ultimately, achieving self-sufficiency in pulses will require more than just import restrictions. It demands a comprehensive strategy that includes infrastructure investments, the adoption of modern agricultural practices, and consistent support for farmers. Only by addressing these fundamental challenges can India build a resilient pulse sector that ensures affordable pulses for consumers while providing fair returns to farmers.

About the Author

Deepak Pareek is a visionary in the agriculture trade and policy domain, renowned for his unparalleled expertise as a serial entrepreneur, investor, and ecosystem builder. With a rich tapestry of 25 years of diverse experience spanning 34 countries. His accolades speak volumes about his impact and dedication. Honored as one of the Top 10 Agropreneurs of 2019 by Future Agro Challenge, Greece, and recognized as a Technology Pioneer in 2018 by the World Economic Forum, Switzerland, Deepak’s contributions are globally acknowledged. His advisory roles with various private, public, and multilateral organizations have driven significant advancements in agriculture and technology.