The government of India assists agricultural export promotion through the Agriculture and Processed Foods Export Development Authority (APEDA) and the Marine Products Exports Development Authority (MPEDA). Together, government grants from export fees to these agencies are estimated at $4.9 million for 1994/95. India continues to operate quasi-governmental marketing boards under the Ministry of Commerce for tobacco, tea, coffee, and spices. Government funding from export taxes for the commodity boards is estimated at $5.7 million. Industry funding for APEDA, MPEDA and the commodity boards is estimated at $3.3 million in 1994/95. In addition, several private trade organizations are involved in export promotions, although promotion expenditures for these organizations are not available.
India continues its relatively high degree of intervention in agricultural trade, although it maintains a very low level of direct export subsidies. The government of India administers export quotas for many commodities, including wheat, coarse grains, sugar, cotton and dairy products. Two government enterprises, the Hindustani Oils Corporation and the Food Corporation of India control imports of vegetable oils and grains.
The government of India recently began to encourage the development of the agricultural sector by reducing excise taxes on many agricultural products and through arrangements that allow Indian processors to import raw materials duty-free for the production of products for export.
The government of India does not support its exports with direct export subsidies, but, in late 1995, reinstated a transportation subsidy for fruits and vegetables. The subsidy is valued at the lesser of $170 per metric ton or 25 percent of the air freight rate for fresh fruits or vegetable exports to the Middle East, Southeast Asia or the CIS. Total subsidy spending was $1.1 million in 1994/95.
The government of India also charges fees to exporters of agricultural products. The fees are credited to the Consolidated Fund of India (the Treasury). The Ministry of Commerce then awards grants to Indian promotion organizations such as APEDA, MPEDA and the Tea Board.
The government of India also began to encourage the development of agricultural exports through its government agencies -- APEDA and MPEDA. Until a few years ago, APEDA, established in 1986, was a small agency which had very little impact on the development of agricultural exports. However, under new leadership and with a growing budget, APEDA has become a stronger advocate for overcoming domestic hurdles to exports and promoting India's products abroad. APEDA assists promotions of floriculture, fresh fruits and vegetables, processed fruits and vegetables, buffalo meat, sheep/goat meat, poultry products, dairy products, processed meats, peanuts, cocoa products, cereal preparations, alcoholic and non-alcoholic beverages, and non-basmati rice. Over 50 percent of market development efforts are in the Middle East, followed by Europe, Japan, the United States, Brazil, Indonesia and Malaysia.
APEDA assists in the promotion and development of agricultural export industries; registers exporters; establishes standards, specifications and improved packaging for exported products; improves the quality of foreign market promotional activities; collects statistics on exports; provides sources of market information for exporters; and sponsors exporter participation in international trade fairs. APEDA also rationalizes procedures in the Indian government for policies that affect exports
APEDA participated and helped Indian firms participate in a number of food shows. APEDA was one of the chief organizers of the AHARA show in India, which resulted in export sales estimated at $32 million. APEDA also participated in foreign trade shows in Chicago, South Africa, Russia, France, Dubai, Saudi Arabia and Japan. APEDA led a delegation of rice exporters to the Middle East and sponsored a delegation of meat exporters to Turkey, Iran and Jordan. APEDA worked to expand exports of buffalo meat to Russia, Bulgaria, Saudi Arabia and Brazil, and held buyer-seller meetings and in-store promotions for Indian grapes, mangoes and strawberries in the United Kingdom, Germany and the Netherlands. APEDA is developing a system for certifying Indian produce as organic produce.
APEDA's budget for 1994/95 for all activities is estimated at $10.6 million. The Ministry of Commerce grant to APEDA in 1994/95 is estimated at about $3.8 million, and industry funding is estimated at $2.7 million. APEDA is governed by 35 members of the public and private sectors and is staffed by 78 full-time government employees
The other government agency assisting agricultural exports is MPEDA, an agency of the Ministry of Commerce established in 1972 to develop and regulate the marine products industry with emphasis on export promotion. Primary promotion markets are Japan, the European Union, the United States, South East Asia, and the Middle East. Frozen shrimp continue to occupy a major share of exports (over 35 percent by volume and 70 percent by value) and of promotions. Other marine products promoted include frozen fish, squid, cuttlefish and lobster. MPEDA spending on export market promotion is estimated at $1.2 million in 1994/95. The bulk of MPEDA's funds comes from the Ministry of Commerce's grant of export levy funding ($1.1 million), while the remaining $100,000 is a direct industry contribution. MPEDA also is involved with aquaculture, research, infrastructure and product development.
MPEDA has trade offices in Tokyo and New York. MPEDA disseminates market intelligence to its members; works to resolve trade complaints; participates in trade fairs; and provides posters, magazines and export directories to its offices abroad. MPEDA's focus will continue to be quality and food safety. MPEDA also will be involved with the development of Turtle Excluder Devices (TED) for shrimp after a U.S. decision to prohibit imports of shrimp which have not been caught with these devices.
India continues to operate marketing boards for tobacco, tea, coffee, and spices. Board are quasi-governmental non-profit organizations under the Ministry of Commerce. Tea is the chief product promoted by a board. The 1953 Tea Act allows the government to collect fees on the exports of tea, from which a grant is made to the Ministry of Commerce for the promotion of tea and other activities to improve tea exports. Export promotion funding for the Tea Board from the Ministry of Commerce is estimated at $4.5 million in 1994/95. Funding for other export boards (coffee, spices, tobacco and cashews) is estimated at $0.05 million for 1994/95.
The ability of the boards to raise funds from industry has diminished in recent years. Some boards are no longer monopolies (coffee) and others are no longer required to register all exports (tobacco, tea). The Commodity Boards focus on development of the domestic industry by encouraging, monitoring, and regulating production while promoting exports and domestic consumption. The Boards also sponsor, assist, and coordinate scientific, technological, and economic research for the promotion of their respective industries.
Current export promotion efforts focus on developing new markets within the countries of the former Soviet Union, while expanding exports to other European countries. Market promotion activities include gathering production and trade information, sponsoring trade delegations, assisting foreign buyers to locate sellers in India, organizing seminars and workshops, and generic promotion for Indian-origin commodities.
Finally, several private trade organizations are involved in export promotion. They include: the Soybean Processors Association of India (soymeal), the Solvent Extractors Association of India (rapeseed meal, sunflowerseed meal, rice bran extraction), the Groundnut Extraction Export Development Association (peanut meal), the Indian Oil and Produce Exporters Association (peanut and sesame), the All India Cotton Seed Crushers Association (cottonseed meal), the All India Rice Exporters Association (rice), and the Livestock and Meat Exporters Association (meat and meat products). Most of the meal exporters focus on Europe, Southeast Asia, and Far East Asia. Rice exporters target countries in Europe and the Middle East. Meat exporters aim their promotions at the Middle East and Southeast Asia. The trade organizations collect annual membership fees. Under the Export/Import Policy of the government, some of these associations have been designated as Export Registering Authorities by the Government, which enables them to collect an export registration fee (rs. 2, or 6 cents per metric ton, for most associations). Additional funding details are not available.