As a fallout of the ongoing India-Canada diplomatic spat, importers are not signing contracts for the import of lentils from Canada since importers are wary of likely retaliatory tariffs that either of the countries could impose, according to a report by The Economic Times (ET).
A decrease in the supply of lentils could lead to a rise in prices at a time when the country is grappling with high inflation in pulses.
A senior executive of an export business was quoted as saying that because of the escalation in diplomatic tension, no new contracts have been signed for the import of lentils. However, traders said that contracts which were signed before the conflict began are being honoured.
n 2022-23, Canada was the biggest exporter of lentils to India, accounting for more than half of the total legume imports into the country with shipments of 485,492 metric tonnes.
India-Canada diplomatic row
In October, Canada said it was recalling 41 of its 62 diplomats in India after what it said was New Delhi’s warning that it would strip their diplomatic immunity. Canada has temporarily suspended visa and in-person consular services in Bengaluru, Chandigarh and Mumbai.
Earlier, Prime Minister Justin Trudeau said that Canada was investigating credible allegations that the Indian government agents were involved in the murder of Khalistani separatist Hardeep Singh Nijjar in Surrey, B.C., earlier this year.
Nijjar, a Khalistani separatist, was shot dead in his truck on June 18 outside a gurdwara in Surrey. He was wanted in India for being the “mastermind” of the Khalistani Tiger Force, a designated terror group in India.
Neither of the countries has imposed any tariffs to discourage trade till now. Over the recent years, India has diversified its lentil imports, with Australia becoming the biggest beneficiary. India has also exempted lentils imported from the US from any sort of customs duty.
This article has been republished from The Business Standard