Spices in distress: Pepper imports flouting minimum import price hurting local produce

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Published: February 28, 2019 2:39:54 AM

The Union government imposed an MIP for pepper at CIF value of Rs 500 per kg to protect the interests of farmers in December 2017.

Import duty of pepper was fixed 70% to protect the interest of the Indian pepper growers but concessions were granted to Sri Lanka under SAFTA, ISFTA and ASEAN agreements.

Domestic pepper market is under stress due to the open imports of the commodity flouting norms of MIP (minimum import price ), according to Jojan Malayil, former president of India pepper and spice trade Association and CEO of Bafna Enterprises.

He added that approximately 25,000 tonne of imported pepper has found its way into the domestic market.

The Union government imposed an MIP for pepper at CIF value of Rs 500 per kg to protect the interests of farmers in December 2017. The decision was based on the proposal of the state-run Spices Board that cheaper imports of the commodity is putting pressure on the domestic market.

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Import duty of pepper was fixed 70% to protect the interest of the Indian pepper growers but concessions were granted to Sri Lanka under SAFTA, ISFTA and ASEAN agreements.

Jojan said Indian imports of pepper has been on the increase and stands at 36,307 tonne in 2018 as against 21,949 tonne in 2015.
“Export of pepper from Vietnam to Nepal and Myanmar has also increased to 5735 tonne in 2018 as against 115 tonne in 2015.During 2017, exports to these countries were 2435 tonne,” he added.

Unscrupulous and unchecked imports of low priced ‘other origin black pepper’ into India is destroying the country’s reputation as the origin of high quality pepper and simultaneously damaging the livelihood of farmers, All India Spices Exporters Forum (AISEF) had said earlier.

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There are also reports of cross border smuggling of black pepper through Nepal and Bangladesh. This is supposed to have been sold into the domestic market adversely affecting our farmers and the consumers, AISEF sources said.

The government move has not stopped the imports of pepper but has hit ‘export oriented units’, who import pepper and export it after value addition.
“So the issue is not imports by value added processors but open imports flouting norms of MIP. MIP was strictly enforced on value added processors for eight months and kicked them out of business to other origins,”Jojan said.

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