The Hindu Business Line : Exporters flay curbs on pepper imports

THE All India Spices Exporters Forum has protested against the restrictions imposed by the Union Government on the import of pepper, saying it is `a retrograde step in the era of liberalisation'.

Demanding the removal of restrictions, the Forum said at least India Pepper and Spices Trade Association (IPSTA) and the Spices Board should have be consulted by the Government before making any changes.

Addressing a press meet, the Forum's Chairman, Mr Thomas Philip, and Vice-Chairman, Ms Sushama Sreekandath, clarified that the fall in pepper prices was not due to imports but rise in the global supply. Global production had increased to 3.40 lakh tonnes in 2004 from 2.54 lakh tonnes in 2000. However, demand and consumption had not kept pace with the 34 per cent growth in production, which is largely due to the entry of Vietnam, whose production was around 1.30 lakh tonnes in 2004. The unsold stock of pepper in the global market has grown from an estimated 58,000 tonnes in 2000 to around 90,000 tonnes in 2005, they added.

Saying that the cancellation of advance licenses on import of pepper would adversely affect the oleoresin industry, they pointed out that export-oriented manufacturers of pepper products have been availing of duty free imports for products such as milled/ground black pepper and pepper oleoresin. As a result, India now accounts for 95 per cent of the world's export of pepper oleoresin with exports of 1,232 tonnes.

Oleoresin manufacturers have been sourcing their raw materials - light pepper berries - for the last 20 years against advance licenses. Imports made by advance licenses for processing and re-export and those made by EOU/SEZ units are closely monitored and inspected by the Government.

The Forum said exporters misusing the facilities must be identified and punished. This is better than banning all imports and punishing the majority of exporters, they added.

Welcoming the government's move to grant a subsidy for exports of pepper and pepper products, the Forum said the subsidies should be given directly to farmers to compensate them for selling their produce at international prices to exporters.

As per the Indo-Sri Lanka Free Trade Agreement, Indian traders could freely import duty free pepper.

The Forum submitted that imports under this scheme have greater potential to impact domestic pepper prices than the imports under advance licenses and those made by EOUs and SEZ units.

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