The Hindu Business Line : Pepper body seeks special sops for exports

The Indian Pepper and Spice Trade Association (IPSTA) has urged the Kerala State Agriculture Minister, Mr Mullakkara Ratnakaran, to initiate steps to have the benefits of Vishesh Krishi Upaj Yojana (VKUY) extended for pepper exports.

At a meeting convened by the Minister recently, they said, black pepper exports which received VKUY benefits for an interim period between September 1, 2004, and April 26, 2005, could to be extended further so that traders could benefit.

Competition

According to an in-depth study, they claimed: "Extraction units import raw material available from the cheapest source and export extraction also enjoy the benefits of VKUY even for imported raw material/ingredient (Krish Upaj)". Indian pepper exporters are struggling to capture world market owing to competition from Brazil and Vietnam in spite of availing WTO compatible freight subsidy made available by the Centre.

At the same time, this benefit was available to the extraction units as well, they said.

Therefore, to protect the interests of pepper exporters and the Kerala pepper growers, extension of VKUY is necessary without any restriction or time limit as long as it is available to others, they said.

On the other hand, in view of the high cost of production in Kerala, they urged the Minister to adopt necessary measures for increasing pepper productivity by extending adequate support to the growers for taking up replanting. They also sought to introduce modern techniques for raising the vines by using silver oak as support tree similar to what is practised in Karnataka.

Decline in Output

While the poor yield per acre has pushed up the cost of production per unit, the State has also lost its market share within the country, they said.

Poor yield per acre in Kerala has not only made the cost of production per unit much higher, but also it has also resulted in a sharp decline in the State's share in the national pepper output, they said.

The pepper productivity needs to be improved in Kerala in order to meet the competition from Vietnam, which has overtaken India in pepper production and exports, they pointed out.

According to official sources, the productivity in Kerala is a meagre 350 grams per vine as against 1.5 kg in Karnataka and over 2 kg in Vietnam. At the same time the daily wages for farm worker in Kerala is Rs 200 compared with Rs 75 to Rs 90 in Karnataka and Tamil Nadu.

As a result, the cost of production is much higher in Kerala making its pepper uncompetitive.

Price Competitiveness

Increasing the pepper production could be the only solution to make the price remunerative and competitive, as it might not be possible to reduce wages in Kerala, they said. They also pointed out that the growers cannot expect the international market to favour them. While the Kerala's share — which used to be over 90 per cent of the country's total annual pepper output until recently — has declined to around 65 per cent, the market share of Karnataka and Tamil Nadu has gone up to 30 per cent and 5 per cent respectively.

In Tamil Nadu, pepper is grown extensively in Pattiveeran Patti, Gudalur and Yercaud areas and in Karnataka more areas are brought under pepper cultivation in Chickamangaluru and Kodagu region. If the current trend continues Kerala could soon its monopoly in pepper, as was the case in coconut and cashew.

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