Agri Business

Seafood exporters irked over by PLI scheme turnover norms

Sajeev Kumar | | | Updated on: Dec 08, 2021
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Fixing ₹600 crore as entry-level criteria are unfair, says an exporter.

The Ministry of Food Processing and Industries' decision to give preference to a few firms, including ITC, under the PLI scheme for seafood during the 2019-20 fiscal has irked some leading and genuine seafood exporters, who have not been included.

A veteran exporter in the industry, who did not wish to be identified, told BusinessLine that the entry-level criteria of a minimum ₹600 crore turnover for the PLI scheme was unfair as many of the members in the fraternity were just below this figure for the qualifying year. But these firms are meeting the other criteria such as minimum investment and CAGR for inclusion in the PLI scheme.

He alleged that the ITC was qualified after including their entire food products turnover to be eligible for seafood PLI. If only seafood exports were taken, the company would not have been qualified as its seafood exports were far below that of more than 50 family-owned exporters, he said.

According to him, the criteria fixed by the Ministry was denying many of the large seafood processors from applying to the PLI scheme. Because of the entry eligibility criteria, many could not apply in the FY 2019-20 as their turnover was below ₹600 crore.

It is also pointed out that the Seafood Exporters Association had even met senior officials in the Ministry in July seeking relaxation. Still, the authorities expressed their inability to amend the eligibility criteria, citing the Cabinet decision.

The exporter also pointed out that the change of criteria to only investment was not adequately and properly informed to the seafood trade. Because of this, some large exporters who are in the process of setting up new state-of-the seafood factories could not qualify to be included in the scheme, even though they exceed the minimum investment criteria and CAGR. These companies could not even apply online as the entry barrier of ₹600 crore is preventing them from accepting their applications.

No response from MPEDA

An e-mail seeking comments from the Marine Products Exports Development Authority elicited no response until this report was published.

When contacted, Alex K.Ninan, president of Seafood Exporters Association of India-Kerala region, said no players from the State would be eligible to be included in the PLI scheme in the present form as they would come under the benchmark level of ₹600 crore turnover. Of the ₹42,000 crore seafood exports from the country, the contribution of marine food exports from Kerala was ₹5,000 crore.

The scheme is not beneficial for most players in the seafood sector, and it will give an advantage to MNC’s and cash-rich exporters. Most of the exporters are mid and small-sized firms and fall below the benchmark of ₹600 crore turnover. To promote exports, he suggested a level playing field for all rather than concentrating on a very few with an uneven distribution of incentives.

Published on December 09, 2021

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