India’s agricultural and processed food exports in the current fiscal are expected to see a moderate growth in comparison to the previous year, mainly due to the anticipated fall in shipment of Basmati rice.
Official sources told FE that decline in shipment due to dip in Basmati rice export would be offset by increase in buffalo meat and fruits and vegetables shipment during the fiscal year.
As per the data available with Agricultural and Processed Food Products Export Development Authority (Apeda), India has exported goods worth of more than R87,553 crore during April – November, 2014, which is marginally higher than the shipment during the same period last year.
Last fiscal, the country’s agricultural goods exports from the Apeda basket was R1,36,920 crore.
“We expect the agricultural goods exports to increase marginally this fiscal mainly because of slowdown in Basmati rice shipment,” Santosh Sarangi, director, Apeda, said. In the first eight months of current fiscal, buffalo meat exports have witnessed an increase of more than 17% to R19, 590 crore as compared to same period last year.
However, with Iran the country’s biggest exports destination for Basmati rice, putting a halt on rice imports because of sufficient domestic stocks, India’s premium aromatic rice exports in terms of volume could decline by around 10% in the current fiscal. In terms of value of Basmati rice exports, the shipment decline could be sharper, industry sources said.
Out of total exports of 3.7 million tonne of Basmati rice from the country in 2013-14 , 1.4 million tonne of rice was shipped to Iran. Sources said the shipment to Iran would fall to around 9 lakh tonne. Last fiscal, India exported Basmati rice worth of R29, 291 crore.
Meanwhile, a delegation from the commerce ministry is visiting Iran early next month to discuss possibilities of reviving rice exports.
Besides rice exports, another worrying trend has been sharp fall in realisation from Guargum shipments because of decline in prices. The realisation from Guargum, mostly used in the US- based oil exploration company, has declined by close to 16% to R6,878 crore in Apri-November, 2014 as compared to same period previous year.
However, the shipment of processed vegetables and fruits, have seen a sharp rise of 39% and 10% respectively in April-November, 2014. The value of exports of processed vegetables and fruits were R1,125 crore and R2,329 crore respectively during the period.
The shipment of other commodities, which witnessed a rise, includes poultry products, groundnut, cocoa products.
Apeda has identified 20 odd clusters located across the country for sustaining growth in the country’s food products exports in the future.
These clusters include Basmati rice (Haryana & Punjab), buffalo meat (western Uttar Pradesh), grape and grape wine (Nasik region, Maharastra), pomegranate (Satara and Pune regions of Maharashtra), dehydrated onions and garlic (Gujarat), poultry or egg (Namakkal) and mango pulp (Uttar Pradesh and Maharashtra).
“Indian agriculture seems to have a greater comparative trade advantage than manufactured goods. This has been possible as the sector has responded by undergoing a structural transformation,” a paper by the Commission for Agricultural Costs and Prices (CACP) chief Ashok Gulati recently stated.