Pepper growers want Sri Lankan free trade pact quota scrapped

THE HINDU: The Consortium of Pepper Growers’ Organisation, Karnataka, Kerala and Tamil Nadu, has urged the Centre to levy 54 percent duty on imports from Sri Lanka under the South Asian Free Trade Area (SAFTA) and scrap the Indo-Sri Lankan Free Trade Agreement quantity of 2,500 tonnes.

To substantiate its demand, the consortium pointed out “pepper production in Sri Lanka has increased substantially from the days of implementation of these trade agreements and other origin pepper is entering the country with Certificate of Origin issued by Sri Lankan authorities”.

Dumping of cheap pepper into the country in spite of the government fixing the minimum import price (MIP) is going on unabated and hence, the consortium has requested all Customs Commissioners to take stringent measures including withholding of all clearances and re-inspection of all pepper imports post MIP.

“In fact, the very purpose of fixing MIP is to safeguard the interests of black pepper growers. As of now, we have to say that fixing of MIP has not come to the rescue of the farmers. It’s disappointing to see our own officers are defeating the system. Due to this in just one month (January 2018) our estimate is that the farmers have already lost ₹60-100 crore,” the consortium Convener Konkodi Padmanabha and Co-Ordinator K.K. Vishwanath told Business Line.

“We have also requested the DGFT to withhold all subsidies, duty refund, etc., of these importers,” they said.

“During January alone, 2,212 tonnes of pepper have been imported. It demonstrates that the entire efforts by the Indian pepper farmers’ consortium, jointly undertaken by Karnataka, Tamil Nadu and Kerala, have been watered down,” the consortium’s Kerala Chapter Head Kishor Shamji Kuruva said.
Data from various ports (Cochin Sea Port, Mundra Sea Port, Nava Sheva Sea Port, Chennai Sea Port and Bangalore ICD as well as Tughlakabad ICD) show a total of 2,212 tonnes of pepper have been imported in January.

This includes light pepper for oleoresin extraction and EOUs and units in the SEZ exempted from the ambit of MIP, while import from Sri Lanka for domestic market appears to have been totally sabotaged. The Customs have collected duty on MIP of ₹500/kg at 8 percent which works to around ₹40-41 a kilogramme. In many cases, the purchase prices are much lower than the MIP, sources said.

Going through the statistics of imports through Bangalore ICD, it appears import of pepper at Bangalore and Nava Sheva from Sri Lanka for domestic use have been charged duty at the MIP, while the prices in the import invoices are much below the MIP.

Furthermore, it is alleged widely that the present imports from and via Sri Lanka are suspected to be of Vietnam origin.

Therefore, one could easily arrive at the conjecture that the material imported at Bangalore ICD, as well as Chennai and Mundra, has not been tested for origin or presence of any pesticide residue.
Meanwhile, the imports at Nava Sheva indicate shipping in of Brazilian pepper, nearly 100 tonnes, at higher duty of 70 percent but the MIP has not been followed since the value of Brazilian pepper appears in the statistics below ₹250/kg.

Internationally, it is feared Brazilian pepper has a contamination of salmonella bacteria requiring further sterilisation if it enters the domestic market.

Taking into consideration the quality and under voicing issues, the domestic industry is at stake when the pepper harvesting for the 2018 crop is round the corner.