 "Arecanut prices decline 26% as imports flood markets")
The new season for arecanut (betel nut) has commenced with prices moving in the southward direction owing to subdued demand in major consuming centres. Prices of white arecanut are currently ruling at Rs 130 a kg, a 26 per cent drop from the previous year. Last year, the season had opened with a price of Rs 176 a kg.
The decline in prices of new arecanut is attributed to a combination of factors that include ban on gutkha in several states and flooding of inferior and cheap variety from Bangladesh and Nepal, industry sources said.
"The north Indian markets are flooded with imported arecanut from Bangladesh and there is no demand for good quality arecanut grown in southern states. We have seen about 24 per cent decline in our sales this year. As a result, we are unable to pass on higher prices to our farmer members," Suresh Bhandary, managing director, Central Arecanut and Cocoa Marketing and Processing Cooperative Limited (Campco), said.
He said drastic increase in imports was hurting arecanut growers. The imports have gone up ever since the government of India allowed duty-free import of arecanut from least developed countries in the SAARC region. Particularly, imports from Bangladesh have gone up seven times to 53,000 tonnes in 2012-13 (till December) as against 7,600 tonnes in 2009-10. The government of India allowed duty-free imports from November 9, 2011.
Arecanut worth Rs 500 crore had been imported from the six countries that are signatories to South Asian Preferential Trade Arrangement (SAPTA) in the nine-month period ended December 2012. Of this, 63 per cent came from Bangladesh. The imports from Bangladesh are higher than what it grows and consumes, Bhandary said.
Unlike other countries, such as Indonesia, which also exports arecanut to India, consumption in Bangladesh is very high. When it produces arecanut in the region of 50,000 tonnes and also has very high internal consumption, how can it export such a huge quantity to India, he pointed out.
"We have taken up the issue with the ministries of agriculture and commerce to find out from where Bangladesh is getting such huge quantity of arecanut. As per the notification issued on November 9, 2011, the least developed countries, including Bangladesh, can only export to India arecanut grown in their territory and are not supposed to import from other countries and then re-export it to India," he said.
Prior to allowing duty-free imports, Indian traders were importing arecanut from Indonesia paying an import duty of 108 per cent. However, in last two years, imports from Indonesia have reduced to 6,000 tonnes as against 29,000 tonnes in 2009-10.
Members of Parliament from Karnataka, Kerala and Assam recently met Agriculture Minister Sharad Pawar and Commerce Minister Anand Sharma and urged them to take measures to re-impose import duty on arecanut and take up the matter with Bangladesh.
They have also requested the government to fix a specified tariff value for the commodity at Rs 125 per kg as against Rs 75 per kg based on the present cost of cultivation.
"In order to save the country's exchequer and also protect the interest of the domestic arecanut growers, we humbly request the government to appoint Central Plantation Crop Research Institute (CPCRI) as the nodal agency for identifying the country of origin and testing the quality of arecanut imported into the country," the members said in their memorandum.
Arecanut is grown on around 400,000 hectares of land in India. The country's production in 2012-13 was estimated at 477,000 tonnes.
The decline in prices of new arecanut is attributed to a combination of factors that include ban on gutkha in several states and flooding of inferior and cheap variety from Bangladesh and Nepal, industry sources said.
"The north Indian markets are flooded with imported arecanut from Bangladesh and there is no demand for good quality arecanut grown in southern states. We have seen about 24 per cent decline in our sales this year. As a result, we are unable to pass on higher prices to our farmer members," Suresh Bhandary, managing director, Central Arecanut and Cocoa Marketing and Processing Cooperative Limited (Campco), said.
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Campco is a multi-state cooperative society involving Kerala and Karnataka, engaged in the promotion of arecanut and cocoa.
He said drastic increase in imports was hurting arecanut growers. The imports have gone up ever since the government of India allowed duty-free import of arecanut from least developed countries in the SAARC region. Particularly, imports from Bangladesh have gone up seven times to 53,000 tonnes in 2012-13 (till December) as against 7,600 tonnes in 2009-10. The government of India allowed duty-free imports from November 9, 2011.
Arecanut worth Rs 500 crore had been imported from the six countries that are signatories to South Asian Preferential Trade Arrangement (SAPTA) in the nine-month period ended December 2012. Of this, 63 per cent came from Bangladesh. The imports from Bangladesh are higher than what it grows and consumes, Bhandary said.
Unlike other countries, such as Indonesia, which also exports arecanut to India, consumption in Bangladesh is very high. When it produces arecanut in the region of 50,000 tonnes and also has very high internal consumption, how can it export such a huge quantity to India, he pointed out.
"We have taken up the issue with the ministries of agriculture and commerce to find out from where Bangladesh is getting such huge quantity of arecanut. As per the notification issued on November 9, 2011, the least developed countries, including Bangladesh, can only export to India arecanut grown in their territory and are not supposed to import from other countries and then re-export it to India," he said.
Prior to allowing duty-free imports, Indian traders were importing arecanut from Indonesia paying an import duty of 108 per cent. However, in last two years, imports from Indonesia have reduced to 6,000 tonnes as against 29,000 tonnes in 2009-10.
Members of Parliament from Karnataka, Kerala and Assam recently met Agriculture Minister Sharad Pawar and Commerce Minister Anand Sharma and urged them to take measures to re-impose import duty on arecanut and take up the matter with Bangladesh.
They have also requested the government to fix a specified tariff value for the commodity at Rs 125 per kg as against Rs 75 per kg based on the present cost of cultivation.
"In order to save the country's exchequer and also protect the interest of the domestic arecanut growers, we humbly request the government to appoint Central Plantation Crop Research Institute (CPCRI) as the nodal agency for identifying the country of origin and testing the quality of arecanut imported into the country," the members said in their memorandum.
Arecanut is grown on around 400,000 hectares of land in India. The country's production in 2012-13 was estimated at 477,000 tonnes.