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LATEST NEWS UPDATES | Get off the ban wagon

Get off the ban wagon

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published Published on Oct 10, 2012   modified Modified on Oct 10, 2012
-The Indian Express

The export-import policy for farm products needs to be consistent and predictable

Sal seeds are obtained from Orissa-based tribals for money that would not compensate them for even the cost of a bus ride to the state capital Bhubaneswar. The produce is, however, valuable as it is converted to sal seed butter, used in Europe by the chocolate industry. But one of the world’s fastest-growing chocolate markets, India, does not allow its use for this purpose. Obviously, the tribals would earn far more if this ban is lifted. India’s agricultural sector is dotted with such bans that are ostensibly meant to protect the farmers or, as in this case, pluckers, but which hurt them in reality. Agriculture Minister Sharad Pawar was right, therefore, in pointing on Tuesday to the need to get away from a policy of frequently and erratically banning exports, and to move towards providing long-term stability to agricultural export-import policy. A five-year time-frame for such a policy, which he recommended, is necessary but seems unlikely, given the penchant for clapping a ban on the export of agro products whenever there is a hint of a price rise in urban markets.

For starters, the assurance that a commodity will be allowed to be exported for at least three years at a stretch, would be helpful. This will ensure an impression of stability in foreign markets about Indian products. In the next stage, this will give a fillip to exports from the agro-processing sector too. As of now, the percentage of such exports is very small. Politicians who jump on to the ban wagon have no clue how badly they hurt the export of processed food from India. The annual export of agricultural commodities last year was about Rs 87,000 crore, but of this the share of processed items was only about 3 per cent. The intermittent ban on the export of rice and wheat for the last few years, for instance, has not only cut down their export by a quarter but also stalled the development of large-scale processing of these items for the overseas market.

In this season of reformist promises, when the government has begun to revisit some of the long-pending measures to revive the economy, consistency in export of farm products is an idea that should be routinised at the earliest.

The Indian Express, 10 October, 2012, http://www.indianexpress.com/news/get-off-the-ban-wagon/1014348/0


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