Adani Food's pulses processing unit proposal in SEZ rejected

New Delhi: The government has rejected the proposal of Adani Food and Agro-processing Park to set up a pulses processing unit in a SEZ on the grounds that export of the commodity is prohibited.

The decision regarding this was taken by the Board of Approval (BoA), headed by Commerce Secretary Rita Teaotia, at its meeting on August 12.

Adani Food is co-developer of a mega food park in the Adani Ports and SEZ in Gujarat. It had sought BoA's nod to set up a pulses processing unit there.

"After deliberations, the board rejected the proposal with observation that procuring pulses from DTA (domestic tariff area) by SEZ amounts to exports," the minutes of the BoA meeting said.

It said that exports of pulses are in the prohibited category of outbound shipments.

As SEZs are treated as foreign entities or outside the customs bonded area, any supply or buying of goods or services from these zones are treated as exports and imports.

Adani Food and Agro-processing Park Pvt Ltd had proposed that the pulses processing unit would be involved in procurement of pulses from DTA and then it would process the same into split dal and besan.

They submitted that their proposed unit does not intend to export pulses/split dal till export of these goods is prohibited by the government.

Export of pulses was initially prohibited for six months in 2006, and the ban extended from time-to-time. It has been extended till further orders.

Although India is the largest producer of pulses, it has to import about 3 million tonnes (MT) of pulses to meet the domestic demand.

Price of this commodity is very sensitive issues in the country.

Scrambling to control prices of pulses that have touched Rs 200/kg, the government had approved doubling of import of tur and other dals from Mozambique to 2 lakh tonnes per annum in next five years.

Pulses production fell to 17.06 MT in the 2015-16 crop year (July-June) from 17.15 MT in the previous year. In 2013-14, output was over 19 MT.

The government had also decided to enhance the buffer stock limit of pulses to 8 lakh tonnes for making market intervention when prices firm up in retail markets.