It will also release around 1.5 million metric tonnes (MT) of wheat in the open market from its stock to further cool down prices.
Food secretary Sanjeev Chopra said there are no plans to tweak wheat import policy as ample stock is available in the country.
“The ban on wheat export will continue,” he added.
According to a notification, wholesalers and traders can keep 3,000 MT of wheat at any given time. Retailers can keep 10 MT.
In the case of big retail chains, the stock limit is 10 MT for each outlet and 3,000 MT for all outlets of a chain.
The stock limit will be in place till March 2024.
The last time a stock limit was implemented on wheat was in 2008.
On June 2 this year, the government had announced a similar move to control prices of tur and urad dals.
In a statement, the department of consumer affairs had said the move was aimed at preventing “hoarding and unscrupulous speculation” and was another step to “crackdown on prices of essential commodities”.
The retail price of the two pulses have shot up due to a projected fall in production during the current financial year.