Govt working to check Lankan pepper imports
The Hindu | 9 June 2006
Govt working to check Lankan pepper imports
G.K. Nair
Growers fear dumping which would drive prices down further
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Raw deal • With no mechanism to check imports and harvesting under way in Sri Lanka, growers fear flooding of the domestic market with imported pepper. • Growers cite lack of quantity restriction in the FTA as key reason for dumping of the commodity. • Sri Lanka is reported to be already offering at Rs 73 a kg anywhere in India. |
Kochi , June 8
Sri Lanka’s pepper exports to the country are a threat to the Indian growers and the Union Government would work out a solution through political and other means, according to Mr Jairam Ramesh, Union Minister of State for Commerce.
The Minister, who was here to hold discussions with all the stakeholders in the commodities sector, however, did not spell out the solution the Government was planning to introduce to arrest the flooding of the domestic market with pepper of other origins.
Meanwhile, some growers, who had come to participate at the meeting convened by the Minister, expressed apprehensions that in the absence of any mechanism to check the imports and the harvesting under way in Sri Lanka, the domestic market would be dumped with imported pepper which in turn would push the prices further down.
Sri Lanka is reported to have already reduced its price to Rs 73 a kg anywhere in India, market sources told Business Line.
Soaring imports
Imports have been soaring in recent years. Arrivals in the country in January - December 2005 stood at 17,636 tonnes as against 15,923.87 tonnes in 2004 and 11,877.65 tonnes the year before.
Significantly, the imports during May - September 2005, the harvesting period of pepper in Sri Lanka, stood at 9,300 tonnes. Imports during January to March 2006 were at 4,468 tonnes as against 2,703 tonnes and 3,507 tonnes in the corresponding period in 2005 and 2004.
Where as, the exports of pepper from the country in 2005-06 were at 16,700 tonnes while in the year before it was 14,150 tonnes. The trend, thus, indicates that the total imports outweighed the export, they claimed.
According to the International Pepper Community (IPC), Sri Lanka had exported 6,853 tonnes of black pepper during January - September 2005, against 3,448 tonnes in the corresponding period previous year, a significant increase of 3,406 tonnes or 98.8 per cent.
India was the largest importer of pepper from Sri Lanka with a share of 90.4 per cent of the total pepper exports in 2004 due to the 100 per cent tariff concession granted under the Indo-Sri Lanka Free Trade Agreement applied since March 2003. Absence of quantity restriction has led to the "dumping of Sri Lankan pepper in our domestic market", they alleged.
As a result, even the Kerala Government’s market intervention exercise last year by procuring 4,800 of black pepper failed to improve the price in the domestic market so far. In fact, the government agency Marketfed is understood to have over 1,500 tonnes of stock.
FTA misuse
Citing the recent reports of the Sri Lankan customs intelligence unearthing a racket involved in export of Indonesian cloves and arecanuts to India under the Indo-Sri Lankan Tree Trade Agreement, as a produce of the island nation, the growers also alleged that pepper of other origins could also land up in India as the produce of Sri Lanka by producing forged country of origin export certificates.
Such imports had also come to the notice of the Spices Board some time ago when the Kochi Customs detained a consignment of 24 tonnes of cloves imported from Pakistan by a Bangalore-based company, suspecting its country of origin, and sought clarifications from the Spices Board. It was confirmed later that cloves was not grown in Pakistan.
According to Mr T. Ashok Kumar, President, Kerala Cardamom Growers Union, similarly cardamom (small) is also arriving in the country from Nepal and Bangladesh as their produce.
Alleged misuse of the Free Trade Agreement (FTA) and Preferential Trade Agreements (PTA) with the country’s neighbours is depriving the Government of revenue, growers of remunerative prices besides negatively affecting the trade, the growers pointed out. They urged the Minister to initiate appropriate action to arrest this trend.
The pepper growers demanded that the quantity of pepper imported from Sri Lanka be restricted besides allowing the imports for the oleoresin industry through a single port, preferably Kochi, so that the quantity and quality of the produce could be strictly monitored.
