Finance Minister Nirmala Sitharaman proposed the imposition of a 35 percent Agriculture Infrastructure and Development Cess in the Union Budget on the apples.
“This cess shall be used to finance the improvement of agriculture infrastructure and other development expenditure,” the Finance Ministry said in a statement.
However, the cess will not be levied on the domestic production of apples including that from Kashmir, India’s largest producer of the fruit.
“It doesn’t impact Kashmir apples or for that matter internally produced fruit in any other state,” said Bashir Ahmad Bashir. “What the government has done is to reduce the 50 percent customs duty on apple imports to just 15 percent and impose 35 percent cess that would be used to develop the agriculture infrastructure”.
Bashir added that in actual terms there has been “no increase or decrease” in customs duty on the imported apple.
“In fact, we would have been happy if the cess on imported apples would have been in addition to the earlier 50 percent customs duty. This would have made our apple cheaper and increased its demand,” he said.
But the fruit growers in Kashmir are still keeping their fingers crossed and waiting for the fine print of the budget to understand how the cess is going to impact them.
Horticulture which is spread across 1.87 lakh acres of land employs more than three million people in Kashmir, earning about 6500 crore for the state. Over the last one and a half year, it has suffered the heaviest loss. The security lockdown and communication blockade following the revocation of Article 370 in August 2019 and later the successive killings of the traders and labourers associated with the apple industry had for a while stopped the export of the trees outside the Valley. And in 2020 again the coronavirus pandemic didn’t help the apple industry.
However, the growers look forward to things to improve. For the first time, Kashmir apple is being exported to Dubai. Dubai’s Lulu Group has started importing apples from Kashmir and also plans to set up a fruit processing centre in Kashmir.
The UAE-based group, which runs more than 180 hypermarkets and shopping malls across the Middle East, has started importing one container (20 tonnes) of apples from Kashmir every week from January 1. The harsh winter and the heavy snowfall stopped the imports though. Last year, around 200 tons of apples were exported.
The group will take the Kashmir apple to Middle East countries like UAE, Bahrain, Saudi Arabia, Qatar, Kuwait and Oman. Apart from apples, Lulu group is also interested in importing saffron, basmati rice, cherries, pulses also from Kashmir.
In October last year, a team of five members of the company spent two days in Kashmir to discuss investment proposal. The team met representatives of apple and saffron associations, visiting apple orchards and cold stores at Lassipora industrial estate in south Kashmir’s Pulwama district.
When contacted, Chief Executive Officer of Fruit Master Agro Fresh Pvt Ltd Izhan Javed told Tehelka that his company has signed a Memorandum of understanding with Lulu Group for supply of apples. He said they have been dispatching the consignments of apples to Dubai.
“It is the first time we are exporting apples to Dubai,” Javed said adding the apples that would be exported include Delicious and Kullu Delicious.
Kashmir produces two-third of India’s apples and the annual production varies between 20-22 lakh metric tons.
“We hope with situation in Kashmir improving, things will look up for the apple industry,” said Fayaz Ahmad Malik, president of Fruit Growers Association of Sopore Mandi. “With vaccination gathering pace, there will be no need for lockdown this year. Hopefully, the peace will also hold. This will allow us to focus on apple production”.
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