Lok Sabha Question No. 2662 (UNSTARRED), answered on 2019-12-04
Subject: Import of Pepper
Ministry: COMMERCE AND INDUSTRY
Asked by: Shobha Karandlaje, Magunta Sreenivasulu Reddy

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO. 2662 TO BE ANSWERED ON 04 th DECEMBER, 2019 TO BE ANSWERED ON 04

## IMPORT OF PEPPER

2662.  KUMARI SHOBHA KARANDLAJE: SHRI MAGUNTA SREENIVASULU REDDY:

Will the Minister of COMMERCE & INDUSTRY ( वािण�य एवं उ�ोग मं�ी ) be pleased to state:

- (a) whether  the  domestic  black  pepper  market  is  witnessing  lower  prices  and  subdued  demand  as compared to last year and illegal imports is the reason behind it and if so, the facts thereof;
- (b) the details of the total production of black pepper in the country;
- (c) whether the import of pepper has increased during the last three years;
- (d) if so, the details of quantum and value of pepper imported during each of the last three years and the current year, country -wise;
- (e) whether  the  Government  has  imposed  a  Minimum  Import  Price  (MIP)  for  pepper  to  protect  the interests of domestic pepper growers and if so, the details thereof;
- (f) whether pepper is smuggled into India from Vietnam, Bangladesh, Nepal and Sri Lanka in the backdrop of country's exchequer loss on import duty;
- (g) if so, the action taken/proposed to be taken to stop unscrupulous and unchecked imports of low priced black pepper in the country; and
- (h) whether the Government is bound by ASEAN agreement to import pepper from member countries at cheaper rate?

## ANSWER

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## THE MINISTER OF  COMMERCE AND INDUSTRY (SHRI PIYUSH GOYAL)

- (a) The price of domestic black pepper during the last three years has shown decreasing trend:-

| Year    |   Average domestic price of pepper (MG1) at Cochin (Rs/Kg) |
|---------|------------------------------------------------------------|
| 2016-17 |                                                     694.77 |
| 2017-18 |                                                     473.73 |
| 2018-19 |                                                     378.21 |

Source: Spices Board India

It  is  assumed  that  the  domestic  price  of  black  pepper  has  fallen  primarily  due  to  decline  in international prices owing to higher production and supply of pepper in the international market and also due to increased import of pepper from other countries into India.

The domestic demand for black pepper has been increasing during the last three years. The details of domestic consumption of pepper during the last three years are given below:-

| Domestic consumption of pepper in India   | Domestic consumption of pepper in India   |
|-------------------------------------------|-------------------------------------------|
| Year                                      | Domestic consumption(MT)                  |
| 2017                                      | 55000                                     |
| 2018                                      | 56500                                     |
| 2019(Estimate)                            | 57000                                     |

Source: International Pepper Community

- (b)  Details of the total production of black pepper in the country during the last three years are given below:-
- (c) & (d)    Details of quantum and value of pepper imported during each of the last three years and in the current year, country wise, are given below:

| Year    | Area (hectare)   | Production (tonnes)   |
|---------|------------------|-----------------------|
| 2016-17 | 134,281          | 62,080                |
| 2017-18 | 139,487          | 71,488                |
| 2018-19 | 138,929          | 62,425                |

Source:   Directorate of Arecanut and Spices Development, Calicut, Kerala

|           | 2016-17   | 2016-17        | 2017-18   | 2017-18        | 2018-19(P)   | 2018-19(P)     | 2019-20 (Apr-Aug)(EST)   | 2019-20 (Apr-Aug)(EST)   |
|-----------|-----------|----------------|-----------|----------------|--------------|----------------|--------------------------|--------------------------|
| Country   | Qty. (MT) | Value Rs.lakhs | Qty. (MT) | Value Rs.lakhs | Qty. (MT)    | Value Rs.lakhs | Qty. (MT)                | Value Rs.lakhs           |
| Sri Lanka | 4900      | 32830          | 13660     | 55169          | 7800         | 37986          | 2003                     | 7842                     |
| Vietnam   | 9500      | 47785          | 10825     | 36757          | 10900        | 23653          | 6657                     | 11129                    |
| Indonesia | 5000      | 26000          | 2320      | 8141           | 4050         | 9761           | 1034                     | 2350                     |
| Brazil    | 500       | 2950           | 1980      | 6558           | 1900         | 4978           | 956                      | 1528                     |
| Others    | 365       | 2026           | 866       | 2458           | 300          | 1614           | 340                      | 686                      |
| Total     | 20265     | 111591         | 29650     | 109084         | 24950        | 77991          | 10990                    | 23535                    |

(P) - Provisional, (Est) : Estimate

Source: DGCI&S Kolkata/DLI from Customs provided by the Spices Board India.

- (e)   In order to reduce the import of pepper and to stabilize the domestic price of pepper, Government had fixed the CIF value of Rs.500/- per kg. as the Minimum Import Price for black pepper vide Notification of Directorate General of Foreign Trade (DGFT) dated 6/12/2017. Subsequently, an amendment was brought in the Minimum Import Price (MIP) notification by making import of pepper at or above Rs.500/- per kg. free and import below Rs.500/- per kg prohibited vide DGFT Notification dated 21/3/2018.
- (f) & (g)   Some representations regarding smuggling of low priced black pepper from other origin to India through  Nepal  and  Bangladesh  border  were  received.    In  this  regard,  the  field  formation  of  Customs  and Directorate of Revenue Intelligence have been alerted and made vigilant at the point of entry in the port to detect and prevent entry of inferior quality pepper, from other countries to India. Customs has booked several cases of attempted smuggling of pepper in the recent past.

Further,  on  the  request  of  the  Government  of  India,  Sri  Lanka  Authorities  have  introduced  a  new procedure to prevent issue of Certificates of Origin for third-country black pepper shipments destined to India. Sri Lanka Authority has also provided access to Indian authorities to examine the scanned copies of Certificates of Origin issued for black pepper exports under ISFLTA and SAFTA and temporarily suspended import of spices including pepper to Sri Lanka through the Entreport Trade and Commercial Hub Operations to prevent these spices being reshipped to India.

- (h)  Under ASEAN Agreement, import of pepper is allowed at 51% import duty (with effect from 1 st January, 2019) against the normal duty of 70% for import from countries not covered under trade agreements.