Massive scandal in export of pulses
Traders made a killing as consumers paid through their nose
Kamal Nath claims he ordered CBI inquiry last week

A major food scam has hit the UPA Government. While the Union Cabinet banned the export of pulses on June 22 last year due to scarcity and rising prices in the domestic market, their export continued in subsequent months. While consumers in India paid through their nose, exporters made a killing by flouting the ban for several months.

Addressing mediapersons, BJP spokesman Ravi Shankar Prasad said that letters of credit for export of pulses were approved by the Government a day before the Cabinet decided to impose the ban.

Prasad also sought Prime Minister Manmohan Singh's intervention. He held Kamal Nath responsible for the alleged pulses export scam and sought his resignation.

"I am informed that many letters of credit against unlimited quantity and period were opened by some exporters in channel islands on or around June 21, 2006 itself and illegal export had been facilitated under cover of manipulated documents.

"This is supported by the fact that the decision was taken on June 22, 2006. But the notification was published on June 27, 2006, followed by a clarification on July 4, 2006 permitting letters of credit opened till June 21, 2006, to carry on the export," Prasad said..

In a two-page letter to Prime Minister Manmohan Singh, the BJP leader asked for a criminal investigation into the scam.

When prices of essential commodities started rising in the middle of 2006, the Cabinet on June 22, 2006 had decided to ban export of wheat and pulses initially for six months and later extended it till March 2007. The Commerce Ministry issued a notification on June 27, 2006 prohibiting export of pulses. But on July 4, 2006, the Ministry clarified that export of pulses contracted after June 22 will not be permitted.

Ban or no ban, export of pulses continued unabated. The Ministry's data showed that after the ban was put in place, pulses worth Rs 170.28 crore were sold outside the country. Pulses export at Rs 361.29 during April-July 2006 crore continued to rise to Rs 531.57 crore during April-October 2006. The export tally this year is roughly 25 per cent less than the previous year for the same period.

Prasad alleged that the manipulation has been done "under direct patronage of the high-ups of the department." He questioned the logic of such an exemption, when no such case was made for wheat. Upset by the July notification citing "irrevocable letter of credit", Prasad said the contract is between two private parties.