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Tax Cuts and Aquaculture Support Vital for Shrimpers, says SEAI

by Ellen Hardy
06 February 2008, at 12:00am

INDIA - The rising rupee, US anti-dumping levies and a battle against competitive shrimp species and cheap imports is plummeting India's seafood trade into crisis.

Marine exports are down 100,000 tonnes and earnings dropped by 20 per cent in the first nine months of the financial year, according to the Seafood Exporters Association of India (SEAI).

In a memorandum to Congress SEAI President Sonia Gandhi, stated that increasing fuel costs and limited availability of marine resources has added to already high production costs. Also, increased competition from cheaper species such as vannamei shrimps, is bringing down the export revenues.

During the past year fuel price has increased by 60 per cent while the rupee has appreciated by 15 per cent. Market pressure from US anti-dumping duty, which has virtually closed the biggest export market, together with increasing global popularity of the Vanammei species has hit India's Rs 60,000-crore domestic marine fishing industry very hard.

Add to this the increasing number of foreign vessels now freely allowed to fish in Indian seas, plus increasing fish imports from China and Vietnam, then the situation really has it crisis point, says the SEAI.

Economic Backlash

The industry is fighting for survival and fears that export revenue might drop further to $1 billion from the present $2 billion (Rs 8,000 crore). This will have an impact on coastal economies and the livelihoods of many people.

Almost 25,000 people employed in export processing have already been laid off and more could follow. Also around 3.5 crore families in eight coastal states are fully dependant on the fishing industry and are threatened by poverty, says the SEAI.

It believes the eliminate state taxes and levy on diesel used for fishing/fish production would improve economics. It has also suggested fishermen are provided with alternate means like cage fisheries to encourage aquaculture production of other species like vannamei, which have lower production cost.

An interest subsidy on term loans, adequate compensation for the anti-dumping duty on shrimp levied by the US and a Generalised System of Preference (GSP) tariff of the EEC down to 0 per cent has also been proposed by SEAI. The waiving of fees imposed by the Export Inspection Agency (EIA) and other bodies has also been suggested.

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Ellen Hardy