New conditions hamper vegetable export to India

Bhutan exported about Nu 19.47mn worth of vegetables to India in the first quarter of 2021

The implementation of the Plant Quarantine Order (PQO) in India, for which a Pest Risk Analysis (PRA) needs to be conducted, has been cited as the main reason by Economic Affairs Minister Loknath Sharma for the drastic drop in the export of vegetables from the country.

He said that the summer vegetable export to India has been disturbed due to additional requirements like PRA, PQ, and other restrictions.

“Importers in India need an import license and those vegetables being imported need to be notified under the PQO of India for which a PRA needs to be conducted,” Lyonpo said.

Additionally, with the introduction of the Goods and Service Tax in India, there have been several new digital developments especially at the entry points (borders) that require documentation and adherence to domestic laws and regulations, according to the Lyonpo.

Lyonpo said that other import conditions need to be fulfilled while importing vegetables into India such as sanitary and phytosanitary conditions, volume restrictions, and minimum import price.

“The importers there aren’t aware of such requirements and in particular importers in the bordering areas,” he said, adding that despite the challenges and situation, an effort is being made to sustain exports.

According to the minister, vegetable exports to India were recorded at Nu 715mn and Nu 23.1mn to COTI (Countries Other than India) in 2020.  For the first quarter of 2021, Bhutan exported about Nu 19.47mn worth of vegetables to India. 

Lyonpo also shared that the RGoB has liaised with the GoI and obtained PRA for almost all cash crops (areca nut, ginger, mandarin cardamom, potato, and asparagus) and additional PRA for other vegetables is being pursued.

“Besides PRA, there are import conditions as mentioned above for which the RGoB is continuously following up. It is important to keep this export channel proper and streamlined,” Lyonpo Loknath Sharma said.

The minister also explained that the buyback scheme is introduced to support farmers with an assured market and it is an option when export or value addition is not possible. “Due to storage and warehouse shortage, it could not be implemented as envisaged and efforts are to streamline further with storage facilities being considered,” he said.

However, export and import in 2020 and 2021 are almost the same.

 In 2020 (January to December), the value of the top 10 exports was approximately Nu 20bn. In the year 2021, from January to May 31, the export value of 10 top exports was approximately Nu 8 bn.

Compared to the previous year (2019) or the pre-pandemic, the export of non-hydro did decrease, but including electricity, it is up by 2%. Export value was recorded at Nu 48.26bn in 2020.   

In addition, concerning the non-hydro export, the value of export in 2020 was recorded at Nu 20.7bn, which is 33.6% down from the previous year.  

According to the economic affairs ministry, goods are being exported from 17 entry and exit points, and to 14 countries and even during the pandemic but at a reduced volume.  

The top 10 exports are mostly mineral-related products like cement, ferrosilicon, dolomite, gypsum, etc.  

Further, the top exports to India include ferrosilicon, boulders, iron and steel, cement, cardamom, pebbles and gravel, gypsum, and dolomite, among others. In 2020, a total value of Nu 16bn worth of goods was exported to India, which constituted about 77.12% of the total export.  

Some of the key vegetables exported to India are potatoes, cabbages, cauliflower, carrots, peas and beans, and asparagus, etc. including cash crops like ginger, areca nut, mandarin, and cardamom, etc.

Kinley Yonten from Thimphu