INDIA MAY BE FORCED TO RENEW FOOD IMPORTS

INDIA MAY BE FORCED TO RENEW FOOD IMPORTS

The Indian government might finally decide to import food grains this year after several months of indecision, trade sources said Monday.

India already has signed an agreement with Burma indicating it will buy rice by countertrade. Other countries - including the United States - reportedly are offering sales at a discount, said the sources, who asked to remain unidentified.A decision on imports should be taken now. It is too risky to postpone it, Bani Ram Gupta, president of the All-India Food grain Merchants Association, told The Journal of Commerce Monday.

India should arrange imports of about 1.5 million metric tons of rice and 1 million tons of wheat this year to strengthen buffer stocks, Mr. Gupta contended.

Finance Minister Narayan Datt Tiwari told Parliament last week that output in the current food year, which runs through June, might fall by between 7 percent and 10 percent because of one of the century's worst droughts.

The government maintains buffer stocks to distribute food at artificially low prices during times when food shortages push up grain prices.

These stocks totaled 14.1 million tons at the end of 1987. Stocks may well fall to less than 11 million tons by the end of this month, government officials said.

The poor autumn crop of 1987 already is reflected in purchases by government agencies.

The official minimum safe level as seen by the food department is 10 million tons in buffer stocks and 6.5 million for operational purposes. Trends in procurement and distribution indicate the safe level already has been breached.