Huge import of low quality black pepper from Sri Lanka

22-Oct-2024 10:58 AM

Mumbai. Under the South Asian Free Trade Association (SAFTA), a huge quantity of black pepper is being imported to India from Sri Lanka at a concessional customs duty of 8 percent.

Actually, its quality is light. The moisture content in it is said to be high. Its bulk density is low and the presence of fungus is also found in it. As a result, a huge amount of it is being imported from Sri Lanka at a very cheap price.

During the current year, Sri Lanka is expected to produce more than 25 thousand tons of black pepper and most of it is likely to reach the Indian markets.

The domestic consumption of black pepper in Sri Lanka is very low and hence it gets the opportunity to export most of its production.

Minimum Import Price (MIP) of Rs 500 per kg is applicable for black pepper in India. After imposing a customs duty of 8 percent on it, the import cost comes to Rs 540 per kg.

The price of black pepper in Sri Lanka is said to be less than Rs 500 per kg, whereas in the domestic sector, the price of indigenous black pepper is around Rs 650 per kg (in the producer markets and terminal market of Kochi).

The Kerala unit of the Sortium of Indian Pepper and Spice Traders-Producers has urged the Central Government to ban or control the import of pepper, saying that the import of large quantities from abroad is badly affecting the interests of indigenous producers.

The consortium has alleged that taking advantage of the loopholes in the import policy, some people are importing cheap black pepper in large quantities.

The black pepper which is imported for the purpose of re-export is also sold at a higher price in the domestic market.

The Directorate General of Foreign Trade has given permission to keep the stock of black pepper imported from abroad for six months before re-export, which is being misused.