Zee News, India

Indias ASEAN offer alive to concerns of plantation sector

Bureau Report

3 June 2007

New Delhi: India’s latest offer on duty cuts under the proposed FTA with ASEAN addresses long-term concerns of tea, coffee and pepper producers who are embarking on a major replantation drive, government has said.

"We would not be able to compete with ASEAN at our current productivity levels which will increase with re-plantation. As its impact will take up to seven years we will have time to improve our competitiveness," Minister of State for Commerce Jairam Ramesh said.

Under the ongoing negotiations, India has offered to cut duties on tea and coffee to 50 per cent from 100 per cent by 2018. On pepper too, duty will be reduced to 50 per cent from 70 per cent during the period. By that time Indian productivity would match its rivals.

The process of replantation of tea gardens has already started whereas for pepper it will start later this year and coffee next year. Indian growers face tough competition in tea and pepper from Vietnam.

Besides these commodities, India has also agreed to bring down duties on palm oil where Malaysia and Indonesia have significant interests.

India had agreed to these concessions so that the FTA negotiations, which has missed many deadlines, could be concluded by July.