Agri Business

Organic products exports rise over 80 times since 2002-03 to record $1.4 b last fiscal

Subramani Ra Mancombu Chennai | Updated on May 04, 2021

Apeda Chairman says US, EU are major buyers as Indian products meet compliance norms

Export of organic products from India grew 51 per cent to a record $1.04 billion in dollar terms during the 2020-21 fiscal compared with the previous fiscal. The increase has come after organic products shipments dropped by nine per cent to $689 million in 2019-20 from $757 in 2018-19.

“Exports during 2019-20 were affected by the Covid pandemic. Until then, exports of organic products witnessed a growth exceeding 25 per cent annually since 2016-17,” said M Angamuthu, Chairman, Agricultural and Processed Food Products Export Development Authority (Apeda).

Since 2002-03, organic products exports have increased by 80 times from $13 million to $1.04 billion.

“Between 2016-17 and 2018-19, organic products exports increased by 25 per cent, 40 per cent and 47 per cent, respectively,” the Apeda Chairman said. The authority functions as the secretariat for the National Programme for Organic Production (NPOP) that is implemented under the supervision of the Ministry of Commerce.

Feature of exports

A major reason for organic products exports’ rapid growth is because India has been able to demonstrate that it can meet the necessary compliance at each level of handling of the product and consistent supply, while contributing to the ecosystem’s sustainability.

“The strength and integrity attained throughout the years has paved the way for double digit growth of organic products exports. This has created better market penetration of Indian organic products in major importing nations,” Angamuthu said.

A feature of Indian organic products exports is that the US and European Union (EU) are among the major markets.

“During 2020-21, our organic products were shipped to 58 countries with major ones being the US, EU, UK, Canada and Switzerland. Exports are currently limited to raw and processed agricultural products comprising oilmeals, oilseeds, cereals, millets, sugar, fruit pulps, purees, plantation crops, spices and medicinal plants,” he said.

Unique advantage

In the organic products sector, India enjoys a unique advantage of having a wide-range of climatic and geographical conditions. It has regions that are most suitable for growing various kinds of field and horticultural crops.

According to agricultural experts, the need for an alternative such as organic products arose since the green revolution had led to indiscriminate use of chemicals in pesticides and fertilisers.

Organic farming not only sustains the health of soils, ecosystems and the people but it combines tradition, innovation and science to benefit all stakeholders.

Though organic farming principles are being followed and practised in many parts of the country, the absence of certification prevented them from being labelled as organic products, the Apeda Chairman said.

Institutional mechanism

With demand rising for certified products in developed nations, the Indian government developed an institutional mechanism, the NPOP, under the Foreign Trade Development Regulations Act of the Directorate General of Foreign Trade.

The adoption of an organised system through NPOP is verified through a third party and such products fetch a premium in the global market, Angamuthu said, adding that organic certification and export commenced in India primarily to cater the organised agriculture trade sectors.

“This was mainly in the plantation sector wherein product handlers were defined to ensure the source of raw material. However, as demand increased for other products also in overseas markets, certification has expanded to other agricultural crops and products,” he said.

‘A revolution’

The NPOP has developed over the years, and it now encompasses small and marginal farmers under the certification system. A grower group certification has been introduced that helps a group of farmers to collectively get certification at an affordable price. It will help them supply ample quantities of certified products, the Apeda Chairman said.

“A revolution has taken place in Indian organic farming as certification of cultivable land has expanded to 34 States and Union Territories. Under NPOP, 1.36 million farmers are certified, making India the country with the largest number of producers in the world,” Angamuthu said.

In addition, minor forest produces such as medicinal plants, products like stem, flower, bark, root, bud and fruit are also certified “as organic provided the collection from the forest area is done without affecting the sustainability”. Export of minor forest produces caters the demands of ayurvedic, pharmacological and cosmetic industries, he said.

Pioneer of Tracenet

There was one challenge that Apeda had to meet in organic products exports. As the area under certification increased as also the products shipped from the country, the authority had to ensure that each consignment could be traced back to the farm.

“Thus, the application of technology was brought into the certification as a tag and also a web-based traceability system, Tracenet. was launched to help track the movement of any organic product from one place to another. India is the pioneer in developing such a traceability system for organic products in the world.” Angamuthu said.

Currently, efforts are on to expand the product categories for organic livestock, poultry, aquaculture and apiculture. There is also demand for organic animal feed in the organic livestock and poultry rearing sector, he said, adding that all these have been brought under NPOP.

Easing export procedures

“Several other categories such as mushroom, seaweed, aquatic plants and greenhouse crops have also been included in NPOP,” the Apeda Chairman said.

Recently, processed form of fibres has also been included in the certification system along with organic cosmetics and personal care products. The certification will be done on a voluntary basis.

But the problem is that establishing a control system takes time in a certification system. However, certification bodies that will clear their new product categories have got accreditation and this has helped to export organic dairy products to a few destinations, Angamuthu said.

In view of the mandatory certification requirement for domestic trade of organic products, farmers and those working with them have been made aware of the compliance requirements, while subsequently tackling export needs.

Apeda has also undertaken efforts to ease the procedure of organic products exports by signing agreements with major importing nations. The EU and Switzerland have approved NPOP as one that is equivalent to EU and Switzerland standards, thus helping export of unprocessed plant products without any other certification, Angamuthu said.

Based on the EU approval, Indian organic products are also permitted into Britain, post its exit from the union.

Empowering States

As part of its efforts to cut certification costs of organic products, Apeda has empowered State government organisations to function as certification bodies. This is based on their competence and system established for inspection and certification as per International Organization for Standards (ISO) norms.

“Of the 32 certification bodies accredited under NPOP, 12 are State Government organisations which are eligible to operate anywhere in the country,” the Apeda Chairman added.

Published on May 04, 2021

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