India and the 10-member Asean nations will soon kickstart a review meeting of the existing free trade agreement (FTA) — signed in August 2009 and enforced from 2010 — and discuss ways to make the pact more ‘modern’, people aware of the matter said.

 

A delegation comprising key officials from Asean nations is expected to be in New Delhi from on 18 and 19 to begin the negotiations.

 

Asean nations include Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.

 

'It will be a complete re-look of the existing FTA. There will be a detailed chapter

India's agri export basket is dependent on just five commodities including rice and sugar and this makes the sector vulnerable to fluctuations in global prices and demand, a report by economic think tank GTRI said on Monday.

The Global Trade Research Initiative (GTRI) said these five products -- basmati rice, non-basmati rice, sugar, spices, and oil meals -- account for 51.5 per cent of India's total agriculture exports.

 

Furthermore, India grapples with various domestic challenges including infrastructural deficits, quality control issues, and non-tariff barriers, all of which impede the growth and competitiveness of its agricultural sector, it said.

'This makes them (agri exports) vulnerable to fluctuations in global prices and demand,' it said, adding these commodities also face frequent export bans in India.

At present export of non-basmati rice is currently banned from India and India is also fighting at the WTO (World Trade Organisation) to protect subsidies to rice and wheat under a public stock holding programme.

Besides, certain WTO member countries have taken India to disputes on sugar for providing subsidies to farmers. 'All this makes India's top exports vulnerable and uncertain,' it added.

To deal with the issue, the think tank has suggested the government to focus on areas like modern infrastructure for the sector.

The report said China with higher rice productivity does not encourage export of rice as every kg of rice products can consume up to 80 litres of water.

It also said that in 2023, India's agricultural trade landscape presents a challenging scenario.

With agriculture exports and imports projected to reach USD 43.3 billion and USD 33 billion, respectively, the sector is experiencing a significant downturn compared to the previous year, it added.

'Exports will decline by 7.2 per cent and imports by 10.1 per cent in 2023 over 2022. India's agriculture exports will be 10.1 per cent of India's merchandise exports.

 

'This decline is exacerbated by the concentration of exports in a few products like rice and sugar, making the market susceptible to global price fluctuations and policy constraints, such as export bans and WTO disputes,' it added.

However, it said that India is learning from global developments and implementing innovative initiatives like farm-to-fork and traceability systems across various agricultural products to enhance quality, safety, and market accessibility.

'Indian agriculture faces significant challenges, including a heavy reliance on rice and sugar, which makes it vulnerable to global market fluctuations and domestic policy changes and unorganised sector activity,' GTRI Co-Founder Ajay Srivastava said.

He suggested a rethink on the sector, as export earnings do not justify input or environmental costs in most cases.

The sector is hindered by inadequate cold chain infrastructure and inefficient logistics, leading to spoilage and export competitiveness issues, Srivastava said, adding quality and traceability inconsistencies, along with high non-tariff barriers in international markets, further impede export potential.

'At the policy level, India's large public stockholding for food security is a contentious issue at the WTO, with ongoing negotiations adding to the uncertainty.

'These challenges, compounded by global agricultural trends and the dominance of a few large firms in the international grain trade, highlight the need for strategic improvements in infrastructure, quality control, and policy adaptation to enhance India's agricultural sector's global competitiveness,' the report said.

The three primary categories for exports are - basic agriculture products, processed agriculture products, and other products.

According to the GTRI's forecast, basic agriculture products will see a decrease in export value from USD 24.8 billion in 2022 to USD 22.3 billion in 2023, marking a 10 per cent decline. This category constituted a significant 51.5 per cent share of India's total agricultural exports.

Processed agricultural product exports may dip from USD 16.3 billion last year to USD 15.7 billion in 2023. The sector accounts for 36.3 per cent of the total exports.

It added that other product categories can register a dip of 5.6 per cent to USD 5.3 billion in 2023 from USD 5.6 billion in 2022. It accounts for 12.2 per cent of total exports.

Non-basmati rice exports have dipped by 12.2 per cent to USD 5.51 billion so far this year (2023). However, basmati rice exports rose by 17.7 per cent to USD 5.3 billion this calendar year.

Sugar exports dipped by 32.4 per cent to about USD 4 billion so far this calendar year. Spices and oil meal exports have increased by 8.5 per cent and 48.6 per cent to USD 3.72 billion and USD 1.,83 billion during the period under consideration.

The other agri products which India exports include coffee, castor oil, fresh fruits, tobacco, processed fruits and juices, groundnut, fresh vegetables, herbal goods, meat, silk, wool and cotton, dairy, and live animals.

Issues about visas, promoting agri trade and resumption of benefits under the American generalised system of preferences (GSP) are expected to figure in the meeting of India-US Trade Policy Forum (TPF) in January here, an official said. US Trade Representative Katherine Tai will be here for a meeting with Commerce and Industry Minister Piyush Goyal.

 

'Both sides will discuss ways to increase trade and investments between the two countries during the two-day meeting from January 13, 2024. It will be the 14th ministerial-level meeting of the India-US TPF,' the official said.

 

The last meeting was held in Washington in January 2023. India in that meeting highlighted the delay in the issuance of business visas to people from India.

 

New Delhi is also keen on restoration of its beneficiary status under the US GSP programme.

 

The previous Trump administration in the US revoked the Generalized System of Preferences (GSP) from India in 2019. The GSP allows eligible developing countries to export duty-free goods to the US.

 

About 1,900 Indian products from sectors such as chemicals and engineering were getting duty-free access to the US market under the GSP, introduced in 1976.

 

Both the countries in the last TPF meet had noted that the movement of professionals and skilled workers and business travellers between the countries contributes to enhancing bilateral economic and technological partnership, the official added.

 

The official said that the proposed social security totalisation agreement may also figure in the meeting.

 

Under a totalisation agreement, an expatriate in either country need not contribute to the social security schemes of the host country. It would benefit a number of Indians, particularly from the IT sector who are working in America and paying social security but are unable to get any benefit out of it.

 

In the 13th TPF meeting, the two countries launched a new working group on 'resilient trade' to deepen bilateral dialogue on a range of issues that can enhance the resiliency and sustainability of the trade relationship including trade facilitation.

 

TPF is a platform to resolve trade and investment issues between the two countries. It has five focus groups -- Agriculture, Investment, Innovation and Creativity (intellectual property rights), Services and Tariff and Non-Tariff Barriers.

 

The US is the largest trading partner of India. America accounts for about 20 per cent of India's total exports in goods and is a key market for services sectors like IT.

 

The bilateral trade between the countries has increased to USD 129.4 billion in 2022-23 from USD 120 billion in 2021-22. India received USD 6 billion in foreign direct investment from the US in 2022-23.

 

A roundtable meeting was held yesterday here under the chairpersonship of the Secretary, Department of Animal Husbandry and Dairying, Ms.  Alka Upadhaya. This strategic gathering brought together key stakeholders, including leading companies, state governments, and industry associations, to deliberate on the 'Export of Indian Poultry Products: Challenges and Strategies to Strengthen the Poultry Ecosystem.'

 

In the meeting Ms.  Alka Upadhaya highlighted that the Indian poultry sector, now an integral part of agriculture, has played a crucial role in meeting protein and nutritional needs. While the production of crops has been rising at a rate of 1.5 to 2 percent per annum, that of eggs and broilers has been rising at a rate of 8 to 10 percent per annum. Over the past two decades, it has evolved into a mega-industry, positioning India as a major global producer of eggs and broiler meat.

 

Ms.  Alka Upadhaya informed that the Department of Animal Husbandry & Dairying has been taking various initiatives to boost the export. The Department has recently submitted a self-declaration of freedom from High Pathogenicity Avian Influenza. To promote export the Department has recognized 33 poultry compartments as free from Avian Influenza. The Department based on the validity has been notified 26 compartments to the World Organisation for Animal Health (WOAH). On October 13, 2023, the self-declaration was approved by WOAH. Further, the Department took initiatives to resolve the issue of feed shortage in the past years. Also the Department took steps to counter the misleading information which spreaded across the country during the COVID time against the consumption of poultry products.

 

Ms.  Alka Upadhaya strongly emphasised on the promotion of poultry exports, strengthening the Indian poultry sector, improving the ease of doing business, addressing challenges in poultry product exports, and strategizing the integration of units in the informal sector and further cementing poultry sectors position on the world stage. She also shared insights on Department proactive approach to mitigate the risks associated with HPAI by adopting the concept of poultry compartmentalization to facilitate the international trade of poultry and poultry-related products.

 

In the fiscal year 2022-23, India made significant strides in the global market, exporting a notable 664,753.46 metric tons of poultry products, with a total worth of Rs. 1,081.62 crores (134.04 Million USD) to over 57 countries. According to a recent market intelligence study, the Indian poultry market achieved a remarkable valuation of USD 30.46 billion in 2023 with a CAGR of 8.1% from 2024-2032.

 

The roundtable meeting served as a platform for dynamic exchanges, encouraging collaborative efforts to address current challenges and formulate robust strategies for the sustainable growth of the Indian Poultry sector. In the meeting the poultry sector representatives, exporters discussed various issues related to poultry export.

 

About the Department of Animal Husbandry and Dairying:

 

The Department of Animal Husbandry and Dairying is dedicated to promoting animal welfare, ensuring sustainable livestock development, and fostering a conducive environment for the dairy and meat sectors in India.

 

About Invest India:

 

Invest India is the national investment promotion and facilitation agency, playing a crucial role in catalyzing investment, fostering innovation, and promoting ease of doing business in India.

 

Trade Promotion Council of India, with the support of the Department of Commerce, is organizing Indus Food from 8th to 10th January 2024 at India Expo Centre, Greater Noida. The event is being considerably scaled-up from its previous edition with the exhibition area being doubled from 30,000 sqm to 60,000 sqm.

 

Over 2,500 global buyers, 5,000+ domestic buyers and 86+ retail chains would be participating. For the first time, more than 120 foreign exhibitors would be participating in addition to 1050 domestic exhibitors. New categories of Food Processing Machinery, Fresh Fruits & Vegetables and Wine & Spirits have been added.

 

The event would also feature Knowledge Sessions, an International F & B Standards Conclave, Masterclasses and Innovation Awards for Industry.

Indonesia's PResident Joko Widodo said on Friday his government has secured rice import commitments from India and Thailand to shore up supply for 2024.

He said the country's food procurement agency Bulog has signed an initial deal for 1 million metric tons from India, while from Thailand, Indonesia has secured a commitment for 2 million tons.

 

Jokowi, as the president is known, said while Indonesia's headline inflation is low, he remains concerned about food prices and imports would help secure supply.

'I am still worried when it comes to food commodities. The super El Nino this year brought our rice production down, and in 2024 we predict that it will not return to normal levels yet,' he told an economic outlook event in Jakarta.

Jokowi said he met with Thai Prime Minister Srettha Thavisin during a meeting last week of Japanese and Southeast Asian leaders in Japan and sought rice imports from Thailand.

The government has sold 3.46 lakh tonnes of wheat and 13,164 tonnes of rice through e-auctions to bulk consumers as part of its effort to boost domestic supplies and control retail prices. The government is selling wheat and rice from its buffer stocks to keep retail prices under control under the Open Market Sale Scheme (OMSS). Food Corporation of India (FCI), the government's nodal agency for food grains procurement and distribution, is conducting the e-auctions.

 

The Centre has allocated 101.5 lakh tonnes of wheat for the OMSS till March 2024.

 

'The 26th e-auction was held on December 20 wherein 4 lakh tonnes wheat and 1.93 lakh tonnes rice was offered. In the e-auction, 3.46 lakh tonnes wheat and 13,164 tonnes rice was sold at a weighted average of Rs 2,178.24 per quintal for wheat and Rs 2905.40 per quintal for rice,' an official statement said.

 

To control the retail prices of rice, wheat and atta, the government is organising weekly e-auctions of both wheat and rice.

 

The minimum and maximum quantity of rice that a bidder can bid has been fixed at 1 tonne and 2,000 tonne, respectively. The bidders can bid in multiples of 1 tonne with respect of rice under OMSS (Domestic).

 

This measure has been taken to enhance the sale of rice under OMSS (Domestic) and in the present e-auction, the sale of rice has increased to 13,164 MT from 3,300 MT that was sold in the previous e-auction.

 

Earlier this month, Food Secretary Sanjeev Chopra said the government is ready to offload additional 25 lakh tonnes of FCI wheat to bulk consumers during January-March 2024, under OMSS, in order to boost domestic supply and check price rise.

 

The West Bengal Government is taking several measures to arrest the fall in production of the famous Darjeeling oranges due to Dieback disease, which caused around 10-15 per cent decrease in production of this variety of oranges this year.

 

Darjeeling mandarin oranges are grown only in Darjeeling and Kalimpong districts of the State.

 

'Darjeeling mandarin oranges are world famous. But its production has fallen significantly. One of the reasons is a disease. Due to this disease, production has fallen by around 10-15 per cent this year,' Food Processing Industries and Horticulture Minister Arup Roy said at West Bengal Food Processing Conclave here on Thursday.

 

Roy said the State government is taking measures to check the fall in productions of oranges due to dieback disease. 'We have talked to Central Citrus Research Institute, Nagpur, and other experts in this regard. We have to help our farmers,' he said.

 

Disease-free planting materials

Over the years, around 80 per cent of total area under cultivation, where Darjeeling mandarin oranges are grown, has reduced in the state only due to the Dieback disease. Production of this variety of oranges has been witnessing a fall also due to pest attacks, shortage of proper quality saplings and reduction in fertility of the soil, among others.

 

In order to address the issue of fall in orange production, the Directorate of Cinchona and other Medicinal Plant, under the State’s Department of Food Processing Industries and Horticulture, is planning to produce quality disease-free planting materials.

 

'We are going to the farmers for rejuvenation of existing orange orchards. For that we will do inarching and disease management, insects and pests management and nutritional management,' a senior government official told businessline.

 

Inarching is required in cases where old and more number of fruits bearing plants get root decaying diseases. 'We will give farmers training,' the official said.

 

The country's alcoholic beverages exports are expected to cross USD 1 billion in the next few years on account of increasing demand for spirits in global markets, a senior government official said on December 21. As against the exports of USD 325 million in 2022-23, the outbound shipments from the sector touched USD 230 million during April-October this fiscal, Additional Secretary in the commerce ministry Rajesh Agrawal told reporters here.

 

The global trade of these products is about USD 130 billion. 'The demand for Indian spirits is increasing…It is expected to go beyond USD 1 billion in the next few years. Indian beverages market is growing very fast and slowly demand for these brands across the world is also picking up,' Agrawal said, adding that in the forthcoming three-day Indus Food show in Greater Noida (Uttar Pradesh), there will be a wine and spirits section.

 

Over 2,500 global buyers, 5,000 domestic buyers and 86 retail chains would be participating in the show apart from over 120 foreign exhibitors. The world trade in the segment is being captured by Scotch (USD 13 billion).

 

When asked if free trade agreements of India will help promote these exports, he said, 'This is also one of the areas where we are trying to negotiate upon…we are also trying to see the duty concessions that are required in various destinations, we get (that)'. The condition that for a product to qualify as a whisky, it must be matured for a period not less than three years has not yet been resolved.

 

The Indian industry claims that because of the warm climate in India, the product matures in one year and gives the same outcome. 'The debate is still on whether we should brand it as Indian whiskey or look for a scotch (brand)…International law in many countries prohibits that (one-year thing). It is an unresolved issue,' he added.

 

According to the alcoholic beverages makers' body Confederation of Indian Alcoholic Beverage Companies (CIABC), it has been highlighted several times, along with scientific substantiations, that such long maturation is not applicable under a warm Indian climate. 'We believe that it is effectively a non-tariff barrier since long maturation increases the cost of Indian products by 30-40 per cent as spirit evaporates 10-15 per cent every year under Indian climate (compared to 1-2 per cent in Europe),' CIABC Director General Vinod Giri has said.

 

He has also said that the cost of capital deployed during maturation in India is high (8-10 per cent per annum) as compared to 2-3 per cent for Europe.

Prices of parboiled rice from top exporters climbed this week, fuelled by limited supplies, pushing Vietnamese rates to their highest in more than 15 years, and in turn driving up the less expensive Indian variety to its highest in two months.

 

Vietnam's 5% broken rice was offered at $660 to $665 a metric ton on Thursday, its highest since mid-July 2008, versus $655 to $660 last week.

 

'Prices edged higher on tight supplies,' said a trader based in Ho Chi Minh City.

 

Preliminary shipping data showed 162,800 tons of rice to be loaded at Ho Chi Minh City port from Dec 1 to 20, with most of it heading to Indonesia, the Philippines and Cuba.

 

The prices of India's exports rose in line with the upward trend in other exporters and concerns over production.

 

India's 5% broken parboiled variety was quoted at $505 to $512 a metric ton this week, its highest in two months, up from last week's range of $499 to $506.

 

'Due to widening gaps between Indian prices and those of other countries, buyers are now willing to accept higher prices,' said an exporter in the eastern city of Kolkata.

 

India's rice output is expected to fall this year, for the first time in eight, making it more likely that New Delhi will extend export curbs to hold down prices ahead of general elections due next year.

 

The price of Thailand's 5% broken rice increased to its highest since August, at $646 to $650 a metric ton, from last week's $640.

 

Traders said the increase was fuelled by more orders from the Philippines this week.

 

Prime Minister Srettha Thavisin said Indonesia told the Thai government of its intent to buy 2 million metric tons of the grain in a letter received on Monday.

 

Supply has dwindled and traders say they expect more entering the market early next year.