The Hindu : Business : Subsidy to boost pepper exports

Online edition of India's National Newspaper
Wednesday, Oct 05, 2005

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Business

Subsidy to boost pepper exports

Exports have dropped drastically owing to stiff competition from other countries

KOCHI: The Union Commerce Ministry has accepted a proposal from the Spices Board to provide subsidy for pepper with a view to boosting pepper exports from India, which has lagged behind largely owing to stiff competition from countries such as Vietnam.

While the Commerce Ministry notification is expected this week, the details of the World Trade Organisation-compatible subsidies are not yet known. The Spices Board had submitted a proposal to the Union Ministry seeking subsidy for both pepper and cardamom. However, the case of cardamom is yet to be taken up.

The Board had submitted its proposals on April 15 last and projected an expenditure of over Rs.21 crores in subsidising operations to upgrade the quality of pepper as well as to subsidise internal and international transport of the commodity. The basis of the proposal was that while Indian exports tended to drop, export from Vietnam had gone up with that country exporting the bulk of its production.

The Spices Board proposal had put up an estimate of 15,000 tonnes of pepper exports from the country with the help of the subsidy.

The 5,000 tonnes of pepper procured by the Government of Kerala during the last financial year at Rs.75 per kg also stands to benefit from the export subsidy scheme.

Export of both pepper and cardamom from India have dropped drastically owing to competition from countries that are selling these produces at prices lower than what is being offered by Indian sellers.

Pepper exports during April-July this year stood at 4,710 tonnes worth Rs.41.93 crores against the 4,662 tonnes of pepper (worth Rs.41.37 crores) exported during the same period during 2004-05.

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