Canada: Lentil sales to India slow following murder allegation

Canadian lentil sales to India have slowed since prime minister Justin Trudeau said last week he suspected India of involvement in an assassination on Canadian soil, industry sources in both countries say.

Trudeau said Canada was “actively pursuing credible allegations” linking Indian government agents to the murder of a Sikh separatist leader in British Columbia in June. India’s foreign ministry called the allegations “absurd.”

Canada is India’s main import source of lentils, a protein-rich staple used to make daal curry.

Reduced Indian purchases would likely cut the prices Canadian farmers receive during harvest, but such a move could also inflate India’s domestic food prices, which would be politically risky ahead of a national election next year.

After a drop in production, India banned wheat exports last year, followed by a ban on non-basmati white rice this year to preserve supplies of those staples.

“Industry officials are concerned that there could be trade restrictions by the governments owing to current tensions between the countries,” said Nitin Gupta, senior vice-president of Olam Agri India, a major importer.

There are no such plans by India, and Delhi has not instructed importers to refrain from purchases, said a senior Indian government official, declining to be named due to the sensitivity of the situation.

The Indian government has suspended issuing visas to Canadians and each country has expelled some diplomats.

Canada is not currently taking any action that would directly affect trade with India, said an official with the Canadian Global Affairs department, declining to be named.

Indian buyers bought significant supplies of Canadian lentils earlier in the year for delivery after harvest, said Kevin Price, senior export merchant at Winnipeg-based crop trader Parrish & Heimbecker.

“Obviously we’re concerned about making sure (the sales) get executed,” Price said, adding that he’s not aware of any cancellations.

“Do they want to take on more now? No. They’re taking a wait-and-see (attitude).”

Tags: Production, India, purchases, sales, food prices, harvest, lentils, prices, Canada