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India allows exports of wheat flour processed from imported grain

NEW DELHI, Oct 15 (Reuters) - India has allowed export-oriented units and the firms set up in Special Economic Zones to export flour made from imported wheat, a government order said on Friday, conceding to the demands of food processors to allow shipments of value-added products.

India will allow food processors to import duty-free wheat against a commitment to export flour, the order said.

After a sudden rise in temperatures in mid-March shrivelled the wheat crop, India, the world's second-biggest producer of the grain, banned overseas sales of the staple to secure supplies for its 1.4 billion people.

Wheat exports from India, also the world's second biggest consumer of the staple, surged after Russia's invasion of Ukraine hit supplies from the Black Sea region, resulting in a jump in global prices.

After banning wheat exports in May, the government of Prime Minister Narendra Modi restricted wheat flour exports in August to keep a lid on local prices.

The ban on wheat exports boosted demand for Indian wheat flour and the country's flour exports jumped 200% during April-July 2022 from a year earlier, lifting prices in the local market.

Close on the heels of the ban on overseas sales of wheat, India restricted rice exports as scant rains in the east affected planting of the most water-thirsty crop.

India's protectionist measures have stoked fears of food shortages in some of the world's most needy and vulnerable countries in Asia and Africa. (Reporting by Mayank Bhardwaj; Editing by Chris Reese)

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