Agri Business

Govt to look into areca import at sub-floor rate

A.J. Vinayak Arun S. Mangalore/ New Delhi | Updated on April 05, 2011 Published on April 05, 2011


The Union Government has started looking into how arecanut import was allowed at a much lower price than the floor price of Rs 35 a kg fixed on June 4, 2008.

This follows a Business Line report in this regard on Monday where it was reported that the details provided by the Union Ministry of Commerce and Industry to the Dakshina Kannada MP, Mr Nalin Kumar Kateel, are an indication of the Government admitting the fact that arecanut imports have taken place from various countries in the last two years at a price lower than the floor import price.

In one case, the import price was as low as Rs 13.72 a kg.

Official sources told Business Line that the Customs Department and the DGCI&S will be asked to look into how arecanut import was allowed at a much lower price than the floor price of Rs 35 a kg fixed on June 4, 2008.

However, the representatives of growers and arecanut cooperatives have sought a ban on the import of arecanut to the country, as India is self-sufficient in its production. (In 2009, India produced 4.89 lakh tonnes of arecanut).

The import had detrimental effect on the arecanut price in India in the last two years, they said.


Though not sure of how such imports have taken place, the sources said the only possibility is that imports of such restricted items can be allowed against a licence.

However, if the importer does not have a licence, the Customs may impose a penalty/fine on such imports and allow them into the country, they said.

But the quantum of fine imposed on such restricted items will not show up in the imported value, and therefore, the original price mentioned in the Bill of Entry (which in this case is the price lower than the floor price) will be taken as the imported price. This, in turn, results in discrepancy, the sources said.


Mr K. Padmanabha, President of Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd, said that if the Government is serious about the welfare of farmers then it should impose a total ban on the import of arecanut.

“If the Government is serious is about imposing a ban on ‘gutkha', in which arecanut is a major ingredient, why can't it impose a ban on the import of the commodity itself,” he said.

The import did not allow the price to come up in the domestic market. Apart from this, import at a lower rate also affected the revenue of the Government, he said.


Endorsing the views of Mr Padmanabha on the ban on import of arecanut, Mr M. Srinivasa Achar, President of All-India Areca Growers' Association, said that the imported stocks of arecanut are of inferior quality. For most of the nations that export arecanut to India, it is a forest crop for them. It is not a cultivated crop abroad. The quality is not good in those countries.

“Fortunately, none of the foreign goods is as good as Indian goods,” he said.

He expressed concern that the imported quantity of arecanut would be much more than the government figures of 41,797 tonnes and 39,526 tonnes of arecanut during 2008-09 and 2009-10, respectively.

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Published on April 05, 2011
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