Dry fruit prices surge, thanks to Afghan crisis – Tehelka

Credit: Original article can be found here

After a temporary suspension in the wake of the Taliban takeover of Afghanistan, the import of Afghan dry fruit has resumed from the dry port at the Integrated Check post on the Attari-Wagah border. However, prices have surged, writes SHVETA MISHRA

The Taliban had stopped all imports and exports with India after a ban on movement of cargo through the transit routes of Pakistan. Dr Ajay Sahai, Director General (DG) of Federation of Indian Export Organisation (FIEO), had raised concern about dry fruit prices going up alarmingly.

India imports around 85 per cent of its dry fruits from Afghanistan. Naturally, the temporary ban had left India’s dry fruit traders worried with prices shooting up by as much as 50 to 80 per cent just weeks ahead of the festive season. Traders point out that imports from Afghanistan had halted because of trade route disruption, issues with paper clearances and the collapse of banking in Afghanistan.

Dry fruits are widely exchanged as gifts, especially during the Dussehra-Diwali season. Corporate gifts make a major percentage of dry fruits.  Afghanistan is one of the major suppliers of apricot and fig to the Indian markets. Other dry fruit imports from Afghanistan include almonds, pistachio nuts, walnuts, and spices. As a result, the Taliban takeover in Afghanistan, which can have major political and strategic repercussions for India, will also hit a specific sector of the Indian market — the dry fruit trade. In fact, Afghanistan is the only source of apricot and dried fig for India.

Traders have warned that if banking channels are not restored soon, Indian markets will feel the absence of these commodities.  Spices such as shah jeera, raw hing and small pistachio nuts are also sourced from Afghanistan. On an average, around 38,000 tonnes of material is imported from Afghanistan annually.

The Taliban takeover has also come at a time when Afghanistan farmers were getting ready to harvest a bumper crop of dry fruits.  India’s import bill with Afghanistan for the financial year 2020-21 was Rs 3,753.47 crore, of which Rs 2,389.86 crore was for ‘edible fruits and nuts, citrus fruits, melons’.

Till last year, almonds were being sold at about Rs 700 to 800 kg but now these are being sold at not less than Rs 1100 a kg.  Dry fruits are among Afghanistan’s most exported agricultural products. India is the second-biggest destination of the country’s exports, making up a share of close to 50 per cent. These imports are through Pakistan via Attari border and then from Amritsar these reach other parts of the country. Goods from Afghanistan normally reach India through the sea route, as containers from the country first go to Iran’s Chabahar port and take the sea route to Mumbai. Some containers are sent via the land route through Pakistan and finally reach Amritsar.

The trade at the ICP has been diminishing gradually since the Pulwama terror attack of 2019. Before the incident, the trade was worth Rs 2,767 crore which dipped to Rs 2,500 crore in 2020-21. India stopped trade with Pakistan after it abrogated Article 370 in August 2019. Afghanistan is also a valuable market for Indian goods, and was the recipient of nearly 8 per cent of the sugar India exported last year. Rahil Sheikh, vice-president of the All India Sugar Trade Association (AISTA), said that “India had exported 6 lakh tonnes out of the total 70 lakh tonnes of sugar exported in the 2020-21 sugar season. Now, with banking channels completely frozen, no trade can take place”.  He, however, said that the situation will become normal in the near future. “Last time, after the Taliban had taken control of the country, the import of essential commodities had become regular once the banking channels were re-established. We feel the same will happen this time,” he said.

Ajay Sahai, Director General (DG) of the Federation of Indian Export Organisations reportedly said that the Taliban have stopped all imports and exports with India, and halted the movement of cargo through the transit routes of Pakistan.  Partial imports have resumed but if these do not normalize in coming days, the prices of the existing dry fruit stock will shoot up further. The FOIEO is keeping an eye on the developments in Afghanistan.

The Government has launched a scheme namely “Merchandize Exports from India (MEIS)” under Foreign Trade Policy, wherein the exporters are incentivized for export of their goods/products to specified markets including dry fruits. In addition, the Ministry of Commerce & Industry has put in place various schemes namely Market Development Assistance (MDA), Market Assistance Initiative (MAI), Assistance to State for Development Export infrastructure and Allied Activities (ASIDE) etc. to boost export of agri products which includes dry fruits also. The result was there as India’s export of Organic food products rose by 51% in terms of value (USD Million), to USD 1040 million (Rs 7078 crores) during financial year 2020-21 compared to the previous fiscal (2019-20).  In terms of quantity, the exports of organic food products grew by 39% to 888,179 metric tonne (MT) during FY 2020-21 compared to 638,998 MT shipped in 2019-20. The growth in organic products has been achieved despite logistical and operational challenges posed by the COVID19 pandemic.

Oil cake meal has been a major commodity of the organic product exports from the country followed by oil seeds, fruit pulps and purees, cereals & millets, spices & condiments, tea, medicinal plant products, dry fruits, sugar, pulses, coffee, essential oil etc.  India’s organic products have been exported to 58 countries including the USA, European Union, Canada, Great Britain, Australia, Switzerland, Israel, South Korea.  According to Dr M Angamuthu, Chairman, APEDA, Indian organic products, nutraceuticals and health food are gaining more demand in overseas markets. Organic products are currently exported from India only if they are produced, processed, packed and labelled as per the requirements of the National Programme for Organic Production (NPOP). The NPOP has been implemented by APEDA since its inception in 2001 as notified under the Foreign Trade (Development and Regulations) Act, 1992.

The NPOP certification has been recognised by the European Union and Switzerland which enables India to export unprocessed plant products to these countries without the requirement of additional certification. The equivalency with the EU also facilitates export of Indian organic products to the United Kingdom, even in the post-Brexit phase.

In order to facilitate the trade between major importing countries, negotiations are underway with Taiwan, Korea, Japan, Australia, UAE, New Zealand for achieving Mutual Recognition Agreements for exports of Organic products from India. The NPOP has also been recognized by the Food Safety Standard Authority of India (FSSAI) for trade of organic products in the domestic market. Organic products covered under the bilateral agreement with NPOP need not to be recertified for import in India.

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