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Sri Lanka spice exporters slam India for slew of extreme non-tariff barriers

ECONOMYNEXT – Sri Lanka’s spice exporters have slammed India for slapping a series of non-tariff barriers to the island’s spice shipment which has almost brought trade in some items almost brought trade in some items to a complete halt.

Spices & Allied Products Producers’ & Traders’ Association (SAPPTA) said India has slapped minimum import prices two and half times the local price of pepper and arecanut to block exports from Sri Lanka.

The SAPPTA said the India has slapped an ‘unrealistic’ minimum import price (MIP) of 500 Indian rupees on Sri Lankan pepper though the local price is only 200 Indian rupees.

After the trade barriers to ‘negligible’ levels, the trade association said.

About 75 percent of Sri Lanka’s exports were to India and almost 100 percent of arecanut exports had been to India, the trade association said.

“Recently the Indian Government Authority instructed our Phytosanitary Department not to issue certificates forthe export of Clove Stems, an absolute requirement for the clearing of cargo in India,” the association said.

“What is the use of Free Trade Agreements, if such restrictions prevent exports? ”

However there had been concerns that Indian traders were routing arecanut from third countries via Sri Lanka through one or more firms which had entrepot trade licenses, mis-using provisions of an Indo Lanka Free trade deals.

The government has said the trade was stopped.

The spice exporters association had also spoken against the practice.

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South Asia is among the least integrated regions due to trade restrictions imposed by inefficient ‘domestic producers’.

High prices reduce living standards overall, and also reduce demand for other domestic goods, by reducing disposable incomes of consumers.

Sri Lankan and Indians have been trading arecanuts for centuries. When the Dutch were occupying Sri Lanka’s coastal regions, in the early British period, arecanuts were the top export from Sri Lanka to India.

At the countries including Sri Lanka (Colombo/Sept26/2019)