India Doubles Down on Bhutan Potatoes to Combat Shortages

Amid soaring potato prices across the country, the Indian government has extended the timeframe for unlicensed potato imports from Bhutan to June 30, 2027. 

A notification to this effect was issued by the Directorate General of Foreign Trade (DGFT), Santosh Kumar Singh, under the Indian government's Ministry of Commerce and Industry, on July 5, 2024. 

In July 2023, DGFT extended the unlicensed import of potatoes from Bhutan for a year till June 30, 2024. Potato imports from Bhutan, which were worth USD 1.02 million in 2022-23, can bolster supplies in neighboring Northwestern states in India, such as Tripura and Assam, which have recently taken measures to stem prices and streamline supplies. 

India's decision to import potatoes without a license for another three years follows media reports that the Bhutan government was exploring export markets in neighboring Nepal and Bangladesh. 

Bhutan's Ministry of Agriculture and Livestock (MoAL) aims to export potatoes to Nepal and Bangladesh to ensure Bhutan farmers don't suffer from price fluctuations in the Indian market. Currently, Bhutan exports potatoes to India, where domestic production levels determine potato prices. India's potato production in 2023-24 was about 59 million tons, about one million tons less than in 2022-2023. 

The intense summer heat triggered a logistical nightmare, with potatoes spoiling during transport. This resulted in record-high potato prices and shortages in some parts of the country. In a recent move, West Bengal, the Indian province that stands second in potato production in the country, banned potato supply in other states. 

In one extreme case, newspaper reports suggest that about a hundred potato-laden trucks on their way to Assam, a neighboring province, were stranded at an inter-state border checkpoint due to the ban imposed by the West Bengal government. 

To augment supplies for retail customers and bring the prices down, the West Bengal Cold Storage Association has offered potatoes to the state government at INR 26 (USD 0.31 ) per kg compared to INR 40 (USD 0.48) in the open market. The state government sells potatoes at INR 26 (USD 0.31) per kg through temporary fair-price shops set up for this purpose. 

In Tripura, the state government opened fair-price shops in the capital, Agartala, to ensure people could buy potatoes and onions at reasonable prices. These shops sell potatoes at INR 35 (USD 0.42 ) per kg. In April, India increased the export quota of essential commodities, including potatoes, to the Maldives by 5%. In 2024-25, India will export 21,513 metric tons of potatoes to the Maldives. 

India's potato export markets are Nepal (USD 48.9 Million), Oman (10.2 Million), Saudi Arabia (USD 8.63 Million), Indonesia (USD 7.7 Million), and Malaysia (USD 6.71 Million). In 2022, India imported potatoes worth USD1.09 Million, mainly from Bhutan USD1.06 Million).