India has agreed to bring down the import duty to 5-10 per cent on some fresh and processed food items as part of a larger dispute settlement between New Delhi and Washington at the World Trade Organization (WTO). 

 

The duties will be reduced on import of frozen turkey, frozen duck, fresh/frozen/dried/processed blueberries, and cranberries. Currently, these items attract import duty of around 30-45 per cent. 

 

'The duty reduction is on MFN (most favoured nation) basis,' government officials said. So, while the duty reduction is a result of the negotiations between India and the US, the tariff cut will be applicable to all WTO member nations, according to the WTO’s MFN principle. 

 

The announcement was made by the United States Trade Representative (USTR), on the sidelines of the G20 Leaders’ Summit in New Delhi, after the bilateral meeting between Prime Minister Narendra Modi and US President Joe Biden on Friday.

 

While the product-specific import duty reduction is yet to be announced, people aware of the matter said that the finance ministry’s revenue department will notify the duty cut in less than six months. 'There’s time up to 180 days …Customs will decide the appropriate time,' a person aware of the matter told Business Standard.

 

The announcement came as part of the seventh trade dispute between the two nations at the WTO over poultry imports from Washington. The development came less than three months after Modi’s visit to the US in June when both countries decided to square off and close six of seven outstanding disputes at the WTO. India, in 2015, had lost a long-standing dispute over poultry imports–mainly chicken legs – from the US.

 

Rationale and impact

 

The rationale behind agreeing to the tariff cuts is that not only the dispute that India lost at various stages at the WTO is laid off, but that the US can get some market access to items that are not very popular in India, said the person cited above. 'This (tariff cut) is unlikely to hurt the domestic market. It is an exclusive market that caters to a limited segment that wants to buy international products. It will be the consumers' choice'.

 

For instance, India is not a major producer of blueberry and depends on import of the fruit to meet its local needs. The US, on the other hand, is the largest producer of blueberries in the world and has been trying to tap the Indian market. In the past, US-based farmers and exporters’ body US Highbush Blueberry Council had said that it had been working with importers and trade associations in India to help reduce the 30 per cent import duty.

 

Arpita Mukherjee, professor at the Indian Council for Research on International Economic Relations, said that import duty reduction of such products will be good for hotels, food processors, and consumers. These items at the moment are niche products and cater to high and middle-income consumers and the hospitality sector.

 

'Besides, the channels through which the products enter the Indian market could be through organised retail or hotel chains, and not through unorganised retail partners. As a result, despite the duty cut, the access of the product for the consumer may not substantially increase and the final price depends on retailer margins,' Mukherjee said.

 

'Gradually, India will have to reduce high tariff on agricultural/food items to facilitate agricultural trade, especially when the country is trying to ink more free trade agreements,' she added.

 

The US is India’s largest export market, with outbound exports at $78.5 billion in the financial year ended March 31, 2023. It is also the third largest import partner, after China and the United Arab Emirates, with inbound shipments amounting to $50.24 billion during the last financial year.

 

-- Tariff cut on some processed and fresh food items, such as turkey, blueberries, cranberries, duck

-- Import duty on such items usually hovers around 30-45 per cent

-- Tariff cut of 5-10 per cent depends on food item

-- Move is part of the larger dispute settlement between India-US at the WTO over India’s poultry import curbs, mainly of chicken legs

Haryana agriculture and farmers’ welfare minister J P Dalal on Tuesday emphasised the need for the government, industrialists, and farmers to unite for the advancement and prosperity of the farmers.

 

He urged the farmers to engage in horticulture and related sectors, which will reduce their agricultural costs and enable them to fetch better prices for their produce, thus increasing their income. The minister was speaking at the closing ceremony of the 4th Innovative Farmers Meet organised by the Confederation of Indian Industry (CII). At the meet, farmers and experts discussed innovative approaches to address challenges facing the agriculture sector.

Signalling a way forward in their ties, Prime Minister Narendra Modi and Turkish President Recep Tayyip Erdogan explored potential in areas like trade and investment, defence and security, civil aviation and shipping.

 

The two met on Sunday evening at the end of the G20 summit. Relations with Turkiye are stabilising since India extended relief for the earthquake in February and with the rise of Indian investors to Europe using Turkiye as a gateway.

 

Later, talking to reporters, Erdogan described India as his country's 'greatest trade partner in South Asia.'

 

'Turkiye and India, which is our biggest trading partner in South Asia, have a serious potential in many fields, especially economy,' said Erdogan, as he seeks trade and investment to boost his country's economy.

 

During the meeting between the two leaders, relations between the countries were discussed in all their dimensions, according to Turkish officials. Projects that would increase economic cooperation and bilateral trade volume, as well as current regional and international issues concerning both countries, were also on the agenda.

 

Turkish officials affirmed that India and Turkiye have similar approaches to the Russia-Ukraine war and favour diplomatic solutions to the crisis.

 

Trade volume between India and Turkiye rose from $5.7 billion in 2020 to $12.3 billion in 2022. Indian companies have invested about $ 126 million in Turkiye (as per Central Bank of Turkiye data) and Turkish investment in India is about $210.47 million (as per Department for Promotion of Industry and Internal Trade, India).

 

India was also one of the first nations to send relief and rescue help to Turkiye in the wake of the February earthquakes that killed over 52,000 people in the south-eastern regions.

The Centre Tuesday said it had not removed customs duty on apple and almond imports from the US and had put in place measures to prevent cheap imports flooding the Indian market.

 

'There is no duty reduction on apples,' Commerce and Industry minister Piyush Goyal said.

 

On the contrary, the government has imposed a minimum import price of Rs.50 per kg on imports of apples from all countries except Bhutan, he added. 'This will ensure that no one can flood Indian markets and hurt our farmers,' Goyal said, adding that India had imposed a 20% retaliatory duty in addition to a 50% import duty on some US imports in view of trade disputes at WTO.

 

Only the retaliatory duty has been removed in view of the resolution of those disputes, he added. India is not self-sufficient in apple production to meet the domestic requirements.

 

An official statement said that following the decision to resolve six outstanding World Trade Organisation (WTO) disputes between the US and India through Mutually Agreed Solutions in June 2023, India has withdrawn additional duties on eight US origin products, including apples, walnuts and almonds.

 

'Additional duties of 20% each on apples and walnuts and Rs.20 per kg on almonds were imposed on the US's products in 2019 over and above the Most Favoured Nation (MFN) duty as a retaliation to the US's state protectionist measure of increasing tariffs on certain steel and aluminium products', it said. There is no reduction in the MFN duty on apples, walnuts and almonds, which still applies to all imported products, including US-origin products, it added.

A positive Indian Ocean Dipole (IOD), which helps in good rainfall over the Indian sub-continent and the African coastline, will likely develop during September-December with all models indicating such a development, the Australian Bureau of Meteorology  (BoM) said on Tuesday. 

 

IOD is the difference in sea surface temperatures (SSTs) between two areas or poles. hence a dipole. The prediction should bring relief to India since any rains, particularly under the influence of north-east monsoon, from now onwards, will help rabi season crops such as wheat, pulses and oilseeds.

 

'The IOD index is +1.13 °C for the week ending September 10. This is its fourth week above the positive IOD threshold (+0.40 °C), with the recent high values (above +1.0 °C) indicating an event is very likely. If the IOD index continues to remain above this threshold, a positive IOD event will be considered underway,' BoM said in its latest El Nino update.

 

Influence on El Nino

While the Indian subcontinent and African coastline will stand to benefit with better rains, it will affect rainfall over Indonesia, South-East Asia and Australia. 'A positive IOD typically decreases spring rainfall for central and south-east Australia and can increase the drying influence of El Nino,' the Bureau said.

 

The Australian weather agency said the long-range forecast indicated warmer and drier than average conditions across most of southern and eastern Australia from October to December. 

 

 

'The Bureau’s El Nino Alert continues, with El Nino development likely during spring (September-December). When El Nino Alert criteria have been met in the past, an El Nino event has developed around 70 per cent of the time,' the BoM said.

 

Sea surface temperatures (SSTs) in the tropical Pacific are exceeding El Nino thresholds and have warmed up over the last fortnight.  Further warming is likely and SSTs may remain above El Nino thresholds until at least early 2024.

 

'The 90-day Southern Oscillation Index (SOI) is currently -7.4, exceeding El Nino thresholds. Other atmospheric indicators have recently shown signs of possible coupling between the Pacific Ocean and the atmosphere,' it said. 

 

Indications near Indonesia

This coupling is characteristic of the El Nino event. This will strengthen and sustain the event for an extended period.  

 

Meanwhile, the Climate Prediction Center (CPC), a unit of the US weather agency National Oceanic  and Atmospheric Administration, in its latest update issued on Monday night, said indication of suppressed convection and precipitation, known as outgoing longwave radiation (OLR) were evident in South-East Asia, the Philippines and Indonesia.

 

In particular, evidence of El Nino emerging was evident near Indonesia, the CPC said, reiterating that all models were indicating El Nino persisting through the northern hemisphere winter during 2023-24.

 

The US weather arm said over the last four weeks equatorial SSTs were above average across most of the Pacific Ocean, the Indian Ocean and across much of the Atlantic Ocean.

 

There were other indicators of El Nino having set in such as upper ocean heat anomalies and declining difference in the temperature on the sea surface and its bottom. 

 

El Nino, caused by a rise in the Pacific Ocean temperature, leads to drought and deficient rainfall in Asia. The weather phenomenon resulted in India witnessing its driest August in over 120 years with monsoon rainfall being 32 per cent deficient. However, the emergence of positive IOD is in line with predictions that rainfall will improve from September onwards in India. 

Hundreds of farmers involved in the cultivation of Apis cerana (Indian/Asian bee) would see a rise in their economies as a result of the Geographical Indications (GI) tag for Solai Honey coming from Banihal in the Ramban region.

 

A geographical indications (GI) tag is a type of intellectual property right that distinguishes products from certain geographic places and links them to those locations' distinctive natural traits and attributes.

 

Deputy Commissioner Ramban, Mussarat Islam earlier announced that Ramban Sulai Honey has been awarded the GI tag. 'A testament to our district's natural heritage and dedication.'

 

The representative from the Agriculture Department claimed that after much effort, we were finally successful in registering the Geographical Indications (GI) tag for Solai, Honey from Banihal.

 

Ayaz Ahmed Rishi, an agriculture official for Banihal said that Ramban district is the major hub for beekeeping.

 

He claimed that more than 480 beekeepers are actively participating in the rearing of Indian/Asian Bees (Apis cerana), and more than 1200 farmers are indirectly involved. Each farmer has an average of two to seven colonies of Indian Asian Bees (Apis cerana).

 

More than 6000 quintals of honey are produced on average each year in the district.

 

Representatives of the Agriculture Department claim that the primary source of income for over 2,000 people's daily requirements is honey bee farming.

 

About 35,500 colonies of Italian/European bees (Apis mellifera) are owned by traders. Additionally, more than 8500 colonies of the Indian bee Apis Cerana are raised conventionally in log and wall hives in the area.

 

We have Acacia, Mustard, Multiflora, Solai, and other wild flora, according to agriculture officials. The focus is on this species since Plectranthus rugosus, also known as Solai locally, is a common plant in the area.

 

Experts of the Agriculture Department claimed the plant is used in traditional medical practices for toothache and is claimed to be effective as an antiseptic, a hypoglycemic, an anti-diarrheal and a bronchodilator.

 

They said the unique taste and texture of Sulai Honey from the Ramban region is due to the availability of wild flora.

 

Farmers who want to venture into integrated farming can avail financial assistance and other support from concerned government departments.

 

Earlier in January 2023, Lt, Governor Manoj Sinha had visited the stall of Sanglaab Valley FRO, for GI tagging of Ramban Sulai Honey during a 2-day workshop on Geographical Indications of North Western Himalayas at SKUAST, Jammu.

The State-run Coffee Board has mooted a proposal to double India’s coffee production over the next 10 years through increasing productivity in the traditional growing states, while bringing in new areas of around 2 lakh ha under cultivation in the non-traditional regions. Coffee has traditionally been grown in Karnataka, Kerala and Tamil Nadu, while the plantation crop has been making inroads in the non-traditional regions of Andhra Pradesh, Odisha and the North East in recent years.

 

Coffee Board Secretary and CEO, K G Jagadeesha said the Board proposes to take a two-pronged approach to double the production by 2033. 'We are looking at a National Replantation Policy for the traditional States, where coffee plants in about 60 per cent of the areas have crossed the economic age. The yields start declining in arabica plants after 40 years and in robusta after 50 years. If we don’t take up replanting in those states where it has crossed the economic age then our yields are bound to go down. We can increase almost 50 per cent of our production by replanting the old and senile plants,' Jagadeesha said.

 

To absorb interest

As part of the proposal, the interest costs on the loans availed by growers to take up replanting in the traditional areas will be absorbed by the government for a period of five years, Jagadeesha said. The Board has sent the proposal to the Commerce Ministry and is awaiting for the government’s approval.

 

Currently, coffee is grown in about 4.72 lakh hectares and the production during 2022-23 stood at 3.60 lakh tonnes. India’s coffee output has more than doubled over the past three decades from around 1.69 lakh tonnes in the early nineties and the Board is targetting doubling the yields over the next decade through improved productivity.

 

Further, Jagadeesha said the proposed area expansion of about two lakh hectares in the non-traditional regions will be carried out by providing subsidies to the growers in collaboration with the respective States. The Centre proposes to share the subsidy burden equally with the States for new area expansion.

 

Odisha’s mission

Jagadeesha said Odisha has already announced a mission to bring about 1 lakh ha under coffee by 2030. In Andhra Pradesh about 80,000 hectares would be brought under coffee, while the cultivation can be expanded to about 25,000 hectares in Tamil Nadu and another 50,000-60,000 hecatres in North East. 'All these areas if we can bring under coffee, we can improve the output,' he said.

 

India, which exports about two thirds of the coffee produced in the country, is hosting the World Coffee Congress (WCC 2023) in Bengaluru from September 25-28 and the event is expected to showcase the Indian coffees to the global buyers.

India and Russia seek to soon begin operations on the Eastern Maritime Corridor (EMC), Shipping Minister Sarbananda Sonowal said on Tuesday.

 

An official statement said the EMC is estimated to reduce the time required to transport cargo between Indian and Russian Ports of Far-East Region by up to 16 days. Once complete, it will take 24 days, down from presently over 40 days, to transport goods from India to Far East Russia. The trade route between Mumbai and St Petersburg covers a distance of 8,675 nautical miles which takes approximately 35 to 40 days.

 

The Chennai-Vladivostok sea route (EMC) will be covering a distance of about 5,600 nautical miles. A large container ship which travels at the normal cruising speed of 20-25 knots (37-46 km/hour), will be able to cover this distance in approximately 10 to 12 days, the statement added.

 

Sonowal, who is on an official visit to Russia, said, 'Currently, there are 802 projects worth investment of more than $65 billion for implementation under the Sagarmala Programme by 2035. Out of which, 228 projects worth $ 14.6 billion have been completed and 260 projects worth $ 27 billion are under implementation.'

 

Another 314 projects worth $ 24 billion are under various stages of development, he added.

Chhatrapati Shivaji Maharaj International Airport (CSMIA) reported exports of 4,700 tonnes of mangoes in 2023, a 318 percent increase compared to 1,123 tonnes in 2022.

 

'This exponential growth is a testament to CSMIA’s contribution to expanding the global presence of India's delectable mangoes. Moreover, it highlights the airport's contribution in driving India’s mango exports,' says an official release.

 

The key aspect contributing to the achievement is the recent approval granted by the United States Department of Agriculture (USDA) for the export of Indian mangoes to the United States, the release added. 'This milestone development opens up the market for Indian mangoes in the USA, marking a significant moment for mango lovers. This approval comes after a hiatus in mango exports to the USA since 2020, primarily due to travel restrictions imposed on the USDA inspectors to visit India during the Covid-19 pandemic.'

 

An official spokesperson says: 'CSMIA stands as a symbol of India’s commitment to delivering the finest produce to the world with the help and guidance from specialists in the field. We are proud to be a part of this growth story and are committed to providing the best possible facilities to support our exporters. This remarkable growth in mango exports reflects our dedication to excellence and our contribution in shaping the global perishable trade landscape.”

 

CSMIA has created a dedicated and state-of-the-art temperature-controlled perishable facility with an annual capacity of 150,000 tonnes, the release added.

 

Air Cargo Forum India (ACFI) launched its Kerala Chapter under the chairmanship of Manoj P Joseph, cargo in charge, Cochin International Airport (CIAL) on September 4, 2023 in Cochin.

 

S Suhas, IAS, Managing Director, CIAL was the chief guest of the event. The event was attended by Yashpal Sharma, President, ACFI and Managing Director, Skyways Group, Sanjiv Edward, Vice President, ACFI and CEO – Cargo & Logistics, GMR Group, Satish Lakkaraju, Chairman, ACFI Event Management Task Pillar and Global Head – Air Freight & Pharma, WIZ Freight, Kamesh Peri, Governing Board Member, ACFI and CEO at Celebi Delhi Cargo Terminal Management along with K.S. Kunwar, Director General , ACFI and Santosh Kumar T.T., Vice Chairman, ACFI Kerala Chapter and Assistant Manager, GH & Cargo Operations, Kannur International Airport.

 

The occasion saw participation from over 100 plus delegates from across the air cargo & aviation industry, some ACFI governing board members and senior leaders from various trade associations including Steamer Association, Indian Chamber of Commerce, FICCI, ACAAI, AMTOI, FFFAI and CCBA.

 

The Kerala Chapter board members will be selected by the ACFI governing board and ACFI secretariat in due course of time with the aim to boost air cargo trade in the region, advocate regulatory changes with authorities, upskill the people by conducting trainings, events and workshops and invite collaboration with fellow trade bodies to steer the air cargo logistics sector in Kerala and at national level. The main aim of Kerala Chapter will be to align itself with the ACFI head office and drive common goals of promoting the air cargo industry to bring it at par with the best global air cargo ecosystems.

 

The four major airports covered under Kerala chapter are: Cochin International Airport (CIAL), Thiruvananthapuram International Airport (TRV), Calicut International Airport (CCJ) and Kannur International Airport (KIAL).

 

Joseph says, 'As the Chairman of Kerala Chapter, I am committed to maintaining close collaboration with every Task Force Pillar under the ACFI umbrella. This will ensure the effective execution of our initiatives in the region with the full support of our ACFI President and members of ACFI. My vision is to establish strong connections between ACFI Kerala Chapter and the prominent players in the air cargo and supply shain sector in Kerala. The realm of air freight logistics is undergoing a transformative phase, driven by advancements in technology, evolving regulations, shifting processes, and ever-changing business environments. This transformation marks the critical role of air cargo, and I am dedicated to navigating and embracing these changes for the benefit of our industry.’’

 

Sharma adds: 'ACFI is dedicated to the development of a world-class air cargo ecosystem in India, one that adheres to the highest international standards. I firmly hold the belief that India's air cargo infrastructure should serve as a model admired for its scale, efficiency and swift delivery even by the most advanced economies globally. I truly believe that our Kerala Chapter will play a pivotal role in our pursuit to establish an Indian air cargo framework that will soon be recognised and benchmarked as a global standard. Furthermore, Kerala Chapter will also ably align itself with the Ministry of Civil Aviation's ambitious target of achieving 10 million tonnes by 2030-31. However, accomplishing this goal requires intensifying our focus on process enhancements, collaborating closely with various entities such as participating government agencies at airports, regulators, shippers, freighters, airlines.'

Rice prices rose globally by 9.8% in the month of August, despite other food prices easing, because of 'trade disruptions in the aftermath of a ban on Indica white rice exports by India', the United Nations’ Food and Agricultural Organisation (FAO) has said in a report. This had led to rice prices reaching a 15-year nominal high.

 

'Uncertainty about the ban’s duration and concerns over export restrictions caused supply-chain actors to hold-on to stocks, re-negotiate contracts or stop making price offers, thereby limiting most trade to small volumes and previously concluded sales,' the report continued.

 

In July, India had banned the export of non-basmati rice to try and curb rising prices. The consumer affairs and food ministry said at the time that the move would 'ensure adequate availability' and 'allay the rise in prices in the domestic market'.

 

Non-basmati white rice constitutes about 25% of the total rice exported from the country. 'The prohibition on export of non-basmati white rice will lead to lowering of prices for the consumers in the country,' the ministry said.

 

India has since announced exemptions for Bhutan, Mauritius and Singapore.

 

Reports have said that over 40 nations depend on India for over half of their rice imports, and certain African and South Asian countries procure over 80% of their rice imports from India.