With cost input inflating by 20 to 30 percent over the past year, the Kashmir apple is heading to a strong market crash, reason- the government of India decision to slash import duty on American apples from 70 % to 50 %.
The major cut in the import duty on Washington apple signals a further distress to the economy of Jammu and Kashmir already troubled by the events that unfolded post August 2019 and the subsequent Covid 19 disruptions. Horticulture, especially the apple production, contributes about 8.2 per cent to the former state’s GDP and helps a host of people secure the necessities of life.
The cut in the import duty was announced recently by PM Modi during his visit to USA. In reciprocity America will lower duty on Indian exported steel and aluminium products.
According to the 2017 data by Food and Agriculture Organization Corporate Statistical Database, a UN subsidiary, China is the global leader in apple production at 43,093,000 tonnes. It is followed by United States of America which produces 6,100,000 tonnes. India ranks fifth at 2,593,000 tonnes. Ironically India’s area (305,000 Ha), under apple farming is two to three times more than America but its production is two to three times less than it, reveals the data.
It is Kashmir which places India among the top apple producers at global level and contributes 70 to 80 percent of the country’s apple produce. Considered the spine of the Kashmir economy, almost 3.5 million people are involved in its farming and a myriad of linkages are associated with its trade.
Subsidised quality inputs and mechanisation enables America to produce two to three times more than India, without involving much cultivable land. On the contrary in Kashmir the inflated ineffective inputs, absence of modernisation and strait jacket approach by the government lays waste the sector which has the potential to change its socio economic dynamics.
Bashir Ahmad Basheer, farmer and trader campaigner under Kashmir Valley Fruit Growers Cum Dealers Union (KVFGT) told this scribe that fertilisers and pesticides have inflated in Kashmir by 20 to 30 percent over the past one year. The prices of the packaging material have also shot up as Goods and Services Tax on its manufacture and sale has been raised from 12 to 18 percent.
It is the intrinsic hardworking nature of the Kashmiri farmers that enable it to harvest 1871723 tonnes of apple a season (2019-20 data). The apple industry is already in over the past couple of years. People associated with it apprehend the flooding of Indian market by the American apple will add another nail to the coffin of Kashmiris apple trade.
Apple worth Rs 600 to 700 crores was lost due to the halting of the fruit laden trucks on the national highway during the previous harvest season, said Basheer of KVFGT.
For the past so many years orchardists in Kashmir have been clamouring over roof tops for bringing Kashmiri apple under the insurance cover. Every year thousands of tonnes of fruit are destroyed by hailstorms and other natural calamities. Instead Rs 2000 to 3000 are doled out to the affected farmers. This is sheer disrespect to the blood and sweat of the farmers who suffer untold losses to the calamitous weather conditions.
Horticulture in Kashmir, Rs 10000 crore industry with ample potential of production and value addition seems to have been relegated to a light weight sector, is the common refrain of the farmers who talked during my reki on the subject. The refrain seems to have weight. A few years ago a south Kashmir politician sulked and felt disrespected when he was allotted a cabinet birth with horticulture portfolio.
The farmers told me that the government initiatives are too far away to revolutionise Kashmir apple production and bring it at par with American, Turkish or Chinese varieties, which look extraordinarily attractive. Farmers lament that nonexistence of scientific input and effective pesticide regimen play the spoil sport in the Valley. The policy space of the government is not reassuring.
The 70 % duty on import of apples from the US to India had decreased sharply from 127,908 tonnes to ($ 145 million in 2018-19 to 4,486 tonnes in 2022-23. The market share of the American apples was taken by other countries like Turkey, Italy and Iran. Slashing it by 20 % on – as part of the resolution of a WTO dispute which would result in the restoration of market access for Indian steel and aluminium exports to the US.
The initiative will eat up the market space of Kashmiri apples across India. Its production costs are already on a steep rise, lesser returns will crash it to an unprecedented level. Can Mr Manoj Sinha, who administers J&K on behalf of the government of India, lobby for Kashmiri farmers and persuade the all-powerful Prime Misters office as their representative. They can only wish.
The writer is Associate Editor of Kashmir Images and can be emailed at rashidpaul@gmail.com
