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Commerce department plans to defer raising duty on 29 US goods
Apr 26, 2019
The department of commerce is likely to propose extending the deadline to impose higher duties on 29 goods imported from the US by another month.
India had set the extant deadline of May 2 after extending it multiple times despite announcing it in June last year in the hope of resolving its trade issues with the US including the Generalised System of Preferences (GSP), agriculture and dairy to medical devices and telecom.
We will propose an extension of the deadline, said an official in the know of the development.
These levies had been proposed in response to the US raising duties on steel and aluminium imports from India and other countries last year.
The department had contemplated extending the deadline on a weekly basis but the suggestion did not find favour with the finance ministry, said another official aware of the intense discussions that took place on Thursday.
New Delhi had weighed the option of allowing the tariffs to kick in from April 1 after the US announced the withdrawal of special duty benefits available to $5.6 billion of Indian exports on March 5.
By statute, these changes may not take effect until at least 60 days after the notifications to the US Congress and the government of India. GSP removal will be enacted by a Presidential Proclamation.
As per the first official, India may consider imposing the tariffs earlier if the US withdraws the GSP benefits earlier.
Trade between India, France continues to expand: report
Apr 26, 2019
The trade between France and India continues to expand, with French companies having more than 550 Indian subsidiaries and employing approximately 360,000 people currently, according to a new report released by France.
The French embassy in a statement here said a total of 1,323 investment decisions were taken in 2018 in France, at an average of 25 decisions per week, according to the 2018 Annual Report: Foreign investment in France, which was released earlier this month at the French Ministry for Economy and Finance.
The trade between France and India continues to expand, with French companies having more than 550 Indian subsidiaries and currently employing approximately 360,000 people, the report said.
It was unveiled by Bruno Le Maire, Minister for Economy and Finance, Christophe Lecourtier, CEO of Business France, and Pascal Cagni, Chairman of Business France and Ambassador for International Investment.
With 17 investment decisions, recorded in 2018, and more than 150 Indian companies already in France, employing more than 7,000 people, Indian investments reflect the improvement in France's image as a business hub, Ambassador of France to India Alexandre Ziegler said in a statement.
India-Russia to strengthen bilateral trade
Apr 26, 2019
In an attempt to fulfill the aspirations of the Indo-Russian business fraternity, the first ever national level participation in the sixth edition of the Irkutsk International Trade Fair, Irkutsk, Russia (August 21 to 24, 2019) is being organised by the India Trade Promotion Organisation (ITPO) at the Irkutsk Exhibition Complex in Russia.
The event aims to carry forward the momentum to further strengthen the bilateral trade relations and provide an excellent business platform to the Indian companies in Russia’s untapped Balkan region. The event will feature bonhomie of the people of Russia towards Indian products as they have a special place in their hearts. Significantly, the event will be visited by the companies from main cities of Siberia, Russia and India’s neighboring countries like China, Mongolia, Kazakhstan, Ukraine, Belorussia and so on.
India's participation assumes special significance as both the countries have made a resolution to set a target for US$ 30 billion in bilateral trade by 2025 and both the countries are working together towards developing a Free Trade Agreement (FTA) to facilitate this target. This also includes the sale of commodities along with civil nuclear energy and defense equipment. The multi-product B2B and B2C event is being held with the support of the Embassy of India in Russia, the Government of Irkutsk Region, the East Siberian Chamber of Commerce and the Industry and City Administration of the Irkutsk city. India's country level participation will bring the two countries together to work jointly towards integrating them into a regional value chain, thereby promoting mutual trade and investment.
The multi-product display profile includes goods and industries including engineering goods, information technology, renewal energy, electronics, building and construction industry (hardware, sanitary ware, ceramics, tiles, interior and décor), pharmaceutical, chemicals, medical and surgical equipment, apparel, textiles and handloom, jewellery, handicrafts, footwear, coir and jute products, horticulture, print and packaging technologies, sports goods, food processing machines/equipment, food and beverages, Ayurveda, yoga, herbal products and cosmetics, health care services, educational institutions, hospitality and tourism industry along with participation from the media and entertainment industry. The business visitors to the exhibition would include importers and exporters, wholesalers, local and regional buyers, among others.
Those who wish to participate in the exhibition can pay the participation fee of $300 per square meters for the equipped shell stands. The exhibitors can order additional equipment and furniture from the exhibitor manual. The catalogue and tariff for extra display stands, renting extra showcases, tables, chairs, and other accessories are available on request with the organisers.
Govt sets foodgrain output target at 291 MT this season
Apr 26, 2019
The government has assumed a modest increase in foodgrains production for the next crop year of 2019-20, starting July, as the last year’s ambitious target could not be achieved as certain crop-producing areas witnessed deficient rainfall even though India Meteorological Department (IMD) had predicted ‘normal’ monsoon. A bumper harvest usually helps the country to increase the overall agriculture growth and boost rural economy, but in recent years, robust production hasn’t really translated into gains for farmers as prices remained subdued.
The target of foodgrains production for 2019-20 crop year is set at a record 291.1 MT, comprising 147.9 MT in kharif season and 143.2 MT during rabi, said agriculture commissioner SK Malhotra at the annual conference of state governments. In 2018-19, the production was 281.37 MT against the target of 290.25 MT. The target for last year was sharply higher than the previous year’s 274.55 MT.
The IMD has predicted this year’s monsoon rainfall to be 96% of the long period average (LPA) of 89cm. The monsoon season of June-September has over 70% share in India’s annual rainfall and is considered key to the success of agriculture sector, as almost 55% of the agricultural land is rain-fed.
The country had got 91% rainfall of the LPA in 2018, while the IMD predicted 97%. According to the weather bureau, rainfall between 96-104% of LPA is considered ‘normal’ and 90-96% of the LPA is categorised as ‘below normal’. The agency will release the region- and month-wise forecast for 2019 in June.
India, China begin to prepare for 2nd informal summit
Apr 26, 2019
With nearly a month to go for the results of the general election, India and China have quietly begun preparing for the second informal summit between their top leadership that is expected to build on the gains of the first such meeting in Wuhan and bridge differences on key issues.
New Delhi initially suggested dates in November for the meeting, set to be held in India, but later agreed on dates in October after Beijing said the timing of the summit should be advanced so that the momentum created by the Wuhan meeting isn’t dissipated, people familiar with the developments on both sides said.
A full plate of issues, including contentious matters such as the disputed border, especially in Arunachal Pradesh; India’s opposition to China’s Belt and Road Initiative (BRI); and China’s position on Pakistan-based terrorists, will be on the agenda for the summit, which an Indian official said would be “qualitatively different” from the Wuhan meeting between Prime Minister Narendra Modi and President Xi Jinping in April 2018.
The Wuhan summit was held against the backdrop of the military standoff at Doklam and was aimed at a reset in ties. There was strategic guidance from the leaders that things were better at the top and this message was sent down and resulted in better understanding in all arms of the government, said the Indian official, who didn’t want to be identified.
It restored some of the trust that had been lost and there has been better management of each other’s sensitivities. In the second summit, we expect to move beyond the ghost of Doklam and truly build on the Wuhan spirit, the official added, noting how both sides were making a conscious effort not to play up differences, including issues such as India’s decision to skip China’s second Belt and Road Forum and Beijing’s hold on efforts to designate Jaish-e-Mohammed chief Masood Azhar at the UN’s 1267 Sanctions Committee.
People familiar with the thinking in official quarters in Beijing said China is looking to take up issues under four broad areas at the summit.
Indian investment in UK on rise despite Brexit: Report
Apr 26, 2019
The number of Indian companies investing in the UK registered a jump over the previous year despite the ongoing uncertainties around Brexit, according to a new report tracking Indian investments in the UK.
The annual 'India Meets Britain Tracker' released in London on Wednesday finds that the number of Indian companies doing business in Britain has increased from 800 in 2018 to 842 in 2019, with a combined turnover of 48 billion pounds.
The report, published by business advisory firm Grant Thornton UK LLP and the Confederation of Indian Industry (CII), revealed a more than doubling of the Corporation Tax paid by these companies to hit 684 million pounds, up from 360 million pounds in the previous year.
The headline figures in the Tracker are startling. They are testament to the strength and entrepreneurialism of the Indian business community, with some companies growing by more than 100 per cent year on year, UK minister for investment Graham Stuart said at the launch.
The minister pointed out that the figures are likely to see a further jump from next year, when the UK's Corporation Tax, from the current level of 19 per cent, will drop to 17 per cent.
We will always welcome Indian investments and we recognise India's importance as one of our most critical bilateral investors,he said.
NHB organises consultation on cluster development programme for fruits
Apr 26, 2019
The National Horticulture Board (NHB) has organised a stakeholder’s consultation on the cluster development programme for fruits like mangoes, bananas and pomegranate recently, as it is working to formulate a new scheme on the horticulture business cluster/value chain development programme.
The newly-adopted Agriculture Export Policy 2018 of the Department of Commerce has also been duly taken into consideration, while formulating the programme that eyes more agri exports from India.
A beginning is planned with the identification of priority crops and the best suited agro-climatic conditions for the identified priority crops, said M Ariz Ahammed, managing director, NHB.
He stated, Mangoes, banana and pomegranate have been identified as the priority crops to be considered under cluster development on pilot basis. Banana, mangoes and pomegranate constitute 31 per cent, 23 per cent and three per cent, respectively, of the total fruit production in the country.
Thus, it is planned to organise this national consultation involving all the stakeholders so as to capture both the problems and the prospects in the development of commodity-specific clusters in the country, Ahammed stated.
Currently, NHB schemes are individual- and entrepreneur-driven (not area-based) with no follow-up after subsidy release on productivity, market or sustainability, stated an in-house assessment report by NHB on the development of the Horticulture in India.
It added that over the years, it was learnt that most of the individual entrepreneurs’ potential to grow has become limited for want of basic infrastructure, viz, roads, irrigation, power, cold chain, marketing, absence of linkages and strategic direction in the production area.
This needs a paradigm shift in approach for commercial horticulture development from the current individual-centricity to an area-centric cluster approach on 4Cs (crop, cluster, convergence and championship), the report noted.
Meanwhile, India’s horticulture production has reached 314 million MT (metric tonne), even outpacing its food grain production.
According to the report, India retains its position as the second largest producer of fruits and vegetables globally. The current production of fruits (97 million MT) and vegetables (187 million MT) not only meets the ICMR EAC 2008 recommended dietary allowance for the country with respect to fruits and vegetables (400g per person per day), but also the current production is near the achievement of the projected demand of fruits and vegetables by ICAR in its Vision 2030 (110 million MT of fruits and 180 million MT of vegetables) much in advance.
DPIIT proposes Startup India Vision 2024; proposes tax sops for new ventures
Apr 26, 2019
The Commerce and Industry Ministry has proposed a host of measures such as tax incentives to promote budding entrepreneurs as part of the 'Startup India Vision 2024', an official said.
The vision document aims at facilitating setting up of 50,000 new start-ups in the country by 2024, and creating 20 lakh direct and indirect employment opportunities.
The Department for Promotion of Industry and Internal Trade (DPIIT) under the ministry, which has prepared the document, has also suggested setting up of 500 new incubators and accelerators by 2024; 100 innovation zones in urban local bodies; deployment of entire corpus of Rs 10,000 crore Fund of Funds; and expanding CSR funding to incubators.
The other measures include setting up of Rs 1,000 crore 'India startup fund' to support high technology start-ups; providing Rs 1,000 crore of seed funding; and operationalisation of seven research parks by 2024.
The DPIIT wants to strengthen the complete ecosystem for startups and these measures would help in doing that. It will be presented to the new government for their consideration, the official said.
As part of regulatory easing, the vision document proposes to reduce compliance burden, setting up of regulatory sandbox for testing of financial products; tax incentives for investments in startups; reduction of Goods and Services Tax (GST) rates; tax exemption for ESOPs; and exemption of angel tax on all investments by Alternate Investment Funds.
Piggybacking on exports to accelerate economic growth
Apr 26, 2019
India being one of the biggest consumers in the world, has traditionally ridden high on domestic demand.
The recent statement by World Bank chief economist, Hans Timmer, mirrors the narrative. India is exporting only 10 per cent of its GDP and needs an export-led growth and be more competitive in the world markets, he offered by way or advice.
Data by the World Bank substantiates the fact. It says that in the last five years, India has witnessed double-digit growth of imports and only 5-6 per cent growth in exports. That means the next phase of growth should have exports firmly in the driving seat if India needs to substantiate, sustain and propel the economy further.
Many may argue that when we can sustain growth, piggybacking on domestic demand, then why change the pace?
The fact is that when you have export-driven growth, then productivity automatically goes up owing to the competitiveness of international markets, understanding the demand mechanism of various customers and getting a know-how of complexities, thereby increasing the competence of product or services.
As per latest data, exports from India increased 2.4 per cent year-on-year to $26.7 billion in February of 2019, mainly due to engineering goods (1.7 per cent) and drugs and pharmaceuticals (16.1 per cent).
As per commerce and industry minister Suresh Prabhu, exports would cross the $331-billion mark in the 2018-19 fiscal year, which no doubt is a positive sign.
However, we cannot restrict ourselves to certain countries or a handful of sectors to drive us forward. Let’s take a look at the sectors and countries that have contributed to the current figures.
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