Andhra Pradesh Chief Minister Appeals to Centre for Support to Aqua Sector Affected by US Tariff
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Synopsis
On April 6, Andhra Pradesh's Chief Minister N. Chandrababu Naidu urged the Indian government to assist the aqua sector in distress due to high US tariffs on marine exports. He emphasized the need for action to protect livelihoods and the state’s economy.
Key Takeaways
- Andhra Pradesh CM calls for federal support.
- US imposes 27% import duty on Indian marine exports.
- Urgent intervention needed to protect millions of livelihoods.
- Exporters face a 20% duty difference compared to competitors.
- Cold storage facilities are full, causing confusion among farmers.
Amaravati, April 6 (NationPress) The Chief Minister of Andhra Pradesh, N. Chandrababu Naidu, on Sunday, called upon the Centre to support the aqua sector, which is currently facing a severe crisis due to the high tariffs imposed by the United States.
In a letter addressed to the Union Minister for Commerce and Industry, Piyush Goyal, the Chief Minister urged the government to engage in dialogue with the US administration to add aqua products to the exemption list from additional duties.
He emphasized that prompt action from the Centre is vital to protect the livelihoods of millions who rely on the aqua sector.
Chandrababu Naidu highlighted the significant contribution of the fisheries sector to the State's Gross Domestic Product (GDP) and stressed that the Centre must assist aqua farmers during this challenging time.
In his letter, he pointed out that the US Administration has imposed a staggering 27 percent import duty on marine food exports from India. During the 2023-24 fiscal year, marine food products valued at $2.55 billion were exported from India to the US, with shrimp making up a remarkable 92 percent of that total.
The Chief Minister noted that aqua farmers are suffering significant losses due to the 27 percent import duty on shrimp exports from India, a sector crucial for the country's shrimp trade. He pointed out that the US imposes only 10 percent duty on competitors like Ecuador, placing India at a disadvantage.
Additionally, he informed the Union Minister that exporters in India are already subject to a 5.77 percent Countervailing Duty (CVD), resulting in a cumulative duty disparity of 20 percent compared to Ecuador when all tariffs are considered.
The new US duty, which took effect on April 5, adds an extra burden on all shipments to the US. Products harvested based on earlier orders are currently in cold storage and at ports, but now also face increased duties due to the new regulations.
In the European Union, Indian exporters confront non-tariff barriers, including inspection rates as high as 50 percent and import duties ranging from 4-7 percent. However, countries like Vietnam benefit from a Free Trade Agreement (FTA) with the EU, allowing them zero-duty access.
As a result, these nations are capturing a larger share of the European market. Countries such as Vietnam, Thailand, and Japan import seafood from India, process it, and then re-export it to the US. However, the new high tariffs are prompting even these countries to cancel their orders from India.
With cold storage facilities at capacity in the state, farmers are left in a state of confusion regarding where to store their harvested aqua products. Furthermore, due to the 27 percent import duty, exporters are halting the procurement of farm products, despite the crops being ready for harvest.
The Chief Minister asserted that these developments are driving the state's aqua sector deeper into crisis, adversely affecting aqua farmers, hatcheries, feed mills, processors, and exporters. Therefore, he reiterated his appeal to the Centre to have the necessary discussions with the US Administration to include shrimp in the exemption list from duties.
