India has granted a quota-based duty concession to the US on apples under the interim trade pact, while fully protecting domestic apple growers, Commerce and Industry Minister Piyush Goyal told NDTV Profit on Saturday.
India has imposed a minimum import price (MIP) of Rs 80 per kg and an import duty of 25 per cent on apples from the US under the proposed India-US trade pact, which is expected to be signed by mid-March.
Minimum import prices have been fixed on certain products, like apples, to protect interests of MSMEs and farmers, the Minister said.
"We import from the United States of America, substantial quantities of apple. And what is the way government has helped our apple farmers? We put a floor, minimum import price, Rs 50 per kilo. Nobody can import below that. And there's a 50% duty, 25 bucks. So Rs 75 landed at the port is the minimum average anybody can bring from abroad. Then there are the costs associated with it. So really our farmers have easily a protection up to Rs 100 or thereabouts," Goyal said at NDTV Profit Conclave in Delhi.
This effectively means apples priced below Rs 100 per kg cannot be imported into the country from the US.
"So Indian farmers are protected in a variety of ways. Sometimes you do quotas, sometimes you do transitional gradual opening," he said.
At present, imported apples attract a 50 per cent import duty with an MIP of Rs 50 per kg, effectively barring imports of apples priced below Rs 75 per kg.
India imports about six lakh tonnes of apples every year, including from the US. About 25.7 per cent of the fruits are coming from Iran, 22.5 per cent from Turkiye and around 8 per cent from Afghanistan. The EU accounts for 11.3 per cent of the shipments.
"The acre under apples is not easily increased because it's in the hill areas. Consumption on the other hand, continues to increase. So while we are trying to increase productivity, we continue to have outpaced demand given the higher prosperity level, higher income levels of the people of India, which is clearly leading to more shortages," he said, accounting for the increased demand.
The Minister also said that several Indian goods, including agricultural products, will attract zero reciprocal tariffs in the US under the interim trade pact.
India has also agreed to lower duty on European apples to 20 per cent under a trade pact between India and the 27-nation bloc, but the imports would be capped at 50,000 tonnes per year and subject to a minimum import price of Rs 80 per kg, thereby fully protecting domestic farmers.
The commodity is a politically-sensitive subject for major apple-growing regions such as Himachal Pradesh and the Union Territory of Jammu and Kashmir.
Earlier today, Himachal Chief Minister flagged the issue of foreign apple imports, calling it a serious concern for his state. "This is a big issue. Under free trade agreements signed by the Union government with various countries, import duty on apples has been drastically reduced. This will have a negative impact on Himachal Pradesh's apple farming economy," Sukhu said.
As per the India-EU free trade agreement, the 50,000-tonne cap will be increased to one lakh tonnes over 10 years.
The two sides last month announced the conclusion of the negotiations. It is expected to be signed and implemented this year itself.
