High air freight charges: Kerala fruit, vegetable exporters losing market

40-50% decline in export volume compared to pre-Covid times; farmers affected adversely

Published: 22nd October 2022 04:19 AM  |   Last Updated: 22nd October 2022 04:19 AM   |  A+A-

For representational purpose. (Photo | BP Deepu, EPS)

For representational purpose. (Photo | BP Deepu, EPS)

Express News Service

KOCHI: Despite facing a deep economic crisis, Sri Lanka, Pakistan and Bangladesh have been posing a tough challenge to Kerala-based vegetable and fruit exporters in the GCC and European markets. According to exporters in Kerala, there has been a 40-50% decline in exports compared to the pre-Covid times. Reason: the steep hike in air freight charges and the 18% GST imposed by the Union government.   

Vegetables and fruits from South India are primarily exported to GCC and European countries and the customers are mostly Indians. Countries like Pakistan, Bangladesh and Sri Lanka are dumping their products in these countries while Indian exporters are not able to compete due to competitive pricing. According to industry sources, the daily export of fruits from Kerala which stood at 275 tonnes, has declined to 175 tonnes due to low demand.

“The air freight charge which was in the range of Rs 35 to Rs 50 per kg during the pre-Covid times, has doubled to Rs 75 to Rs 100. Meanwhile, the Union government has imposed 18% GST on air freight. This has forced us to hike prices of our products in the export market. The same products are dumped in the global market at cheaper rates by Pakistan, Bangladesh and Sri Lanka. This has led to a decline in demand for our agri products. An exporter who used to export 35 tonnes of vegetables a day have been forced to bring down the export volume to 15 tonnes,” said All Kerala Exporters Association secretary M Abdurahiman. “China is dumping garlic and ginger in the market at cheap rates.

Sri Lanka, Pakistan, Bangladesh, Vietnam, Indonesia and the Philippines are providing vegetables and fruits at cheaper rates. There has been a 45% to 50% decline in our exports. We have been pleading with the ministries of commerce and finance to reduce the air freight charges and GST, which has led to a decline in foreign exchange income of the country. The drop in export volume has affected the farming community adversely, said K B Exports MD K B Rafeeq.



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