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G.K. Nair

KOCHI, May 19

PIQUED over anomalies in the Exim Policy, pepper traders have urged the Centre to remove these as they are allegedly being exploited by a certain section of the trade.

They claim traders, in general, had objections in the anomalies and the "foul tactics being adopted by those involved in the imports creating a situation that only those who are importing can exist in the export trade".

Since the Union Government has fixed 70 per cent duty on imports, it is an open secret that 50 per cent of the imported pepper, i.e., the bold berries, are being dumped into the domestic market and balance after mixing with the indigenous material being re-exported as of Indian origin, they alleged.

"Misdeclaration" in the customs has been noticed by the authorities wherein to the customs "imported stuff being re-exported is declared and to the buyer, it is being passed off as Indian black pepper MG-1."

Thus, they said, by mixing imported stuff into the indigenous pepper, these importers were able to secure export order at discounted levels.

"They make huge profits by selling 50 per cent into the domestic market and that is against the import policy and illegal," they alleged.

According to them, some of the importers themselves try to keep the futures market tight at high prices, even incurring losses.

A majority of the pepper growers in the country are smallholders and constantly follow the futures market, even though they do not participate directly. As a result, they take future prices as indication to arrive at the decision of selling their produce and get carried away by the high future prices and hold back their produce. This creates tight supply position in which "these importers could market their imported stuff into the local market and earn high profits, part of which they can afford to lose in the futures market, which they are keeping high intentionally", they argued.

Regarding imports from Sri Lanka, they said, the past three-year average of Sri Lankan exports would come to around 3,500 tonnes whereas last year it was 7,729 tonnes. When the world exports have declined by 13 per cent, Sri Lankan exports during the first quarter of 2003 have jumped by 600 per cent, they said. Exports to India, which were 782 tonnes in 1996 and 1,781 tonnes in 2001, had gone up to 5,582 tonnes in 2002, they said.

The trade had been trying to highlight these anomalies of Sri Lankan exports into India, which, they said, were not justifiable.

Recently, the Union Commerce Secretary, Mr Deepak Chatterjee, has been quoted as saying that the Union Government had removed import duty for Sri Lankan pepper as his Ministry was not aware of jumping up of pepper export figures of Sri Lanka to this proportion.

"We are not against imports," they said. But, "we are pointing out the damage done by the unscrupulous ways and means adopted in the import-export field". Those who hold stocks have definitely taken advantage of the artificial futures market prices created by importers and, therefore, the premiums have disappeared now.

"It is high time that the Director General of Foreign Trade as well as the Customs and Central Excise department keep a vigil and also the Commerce Ministry should look into the imports from Sri Lanka duty free as their exports have gone up disproportionately in comparison with world export, which appears to be very fishy and doubtful", they said.

The experience since 1998 till 2002, they pointed out, shows that "those who had gone short are out of the trade while some of them had to curtail their activities because of the very bitter experience of going short in pepper".

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