Why are apple traders in J&K worried?, Pg8

Key Highlights:

• India reduced the basic customs duty on apples imported from the U.S. from 50% to 25%, with a Minimum Import Price (MIP) of ₹80 per kilogram.
• The India-European Union trade deal reduced import duty on fresh fruits to 20% under a Tariff Rate Quota (TRQ) system, allowing 50,000 tonnes of apples per year, set to increase to 1,00,000 tonnes over 10 years.
• Apple production in J&K constitutes 50% of its total horticulture production, generating roughly ₹10,000 crore in revenue and employing about 35 lakh individuals.
• J&K contributes over 70% of the total apple production in India, with 21 lakh metric tonnes produced in 2024 across 173.07 lakh hectares of land.

Detailed Insights:

• The reduction in import duties has raised concerns in J&K about the ability of local apple producers to compete with Western countries due to differences in farming practices and technology.
• Western countries produce significantly higher yields (40-70 tonnes per hectare) compared to India (7-8 tonnes per hectare) due to advanced technology, mechanization, and favorable geography.
• Local orchardists fear that cheaper apple imports will negatively impact prices in controlled-atmosphere cold storages, where Kashmir stores 397.08 lakh metric tonnes of apples in 92 cold storages.
• J&K parties are urging the central government to re-evaluate the trade deal and implement safeguards for apple producers, including interest-free loans under the Holistic Agriculture Development Programme (HADP).
• There are calls for expanding cold storage infrastructure and activating dry port projects in J&K to facilitate the smooth transportation of apples to markets outside the region.

Key Concepts Involved:

• Basic Customs Duty: A tax imposed on goods when they are imported into a country.
• Minimum Import Price (MIP): The lowest price at which goods can be imported, set to prevent undercutting of domestic markets.
• Tariff Rate Quota (TRQ): A two-tiered trade policy that applies a lower tariff rate on imports within a specified quantity and a higher rate above that quantity.