ATM News Network: The Crop Care Federation of India (CCFI) has expressed the need to reconsider the existing customs duty structure on import of agrochemicals. For this, the senior officials of the organisation have met the officials of Central Indirect Tax Department, Customs Department, Revenue Department and Finance Ministry.
Despite India being a leader in the field of chemicals, CCFI has expressed fear of a huge increase in the import of agrochemicals. The value of agrochemical imports has increased by 37% in the last 2 years. Compared to the base year 2019-20 imports, this has increased by 50%.
About 53% of the imports, mainly for resale by multinational companies and traders, are for ready formulation, which needs to be stopped, the CCFI said.
Imported formulations generate zero employment. There is no value addition in it. It cannot quantify proper quality. This results in the supply of inferior materials. Indigenous manufacturers have the capacity to produce most of these imported chemicals. Formulation and technical production at 50-87% lower cost compared to imports has the potential to save valuable foreign exchange, said Harish Mehta, Senior Advisor, CCFI.
Mr. Mehta says that currently the import duty for formulation is at the same level as the technical category ie both 10%. As a result there will be no incentive to manufacture in India. The formulation is mostly imported from multinational companies and traders. They do not have their own or limited manufacturing facilities in India. Primarily dependent on tollers for repacking only, they have major plants in China or elsewhere.
Any change in customs duty on imports will not affect farmers' prices. Because already imported products are sold at 2 to 2.5 times higher price compared to manufacturing in India. Primarily used for resale at a profit of up to 200 percent of rectangles.
Members of CCFI are implementers of the government's policy towards 'Self-reliant India' through Make in India. All manufacturers have manufacturing plants with research and development facilities. Hence quality products are manufactured meeting global specifications. Mr. Mehta explained that Indian members account for more than 80% of exports to 130 countries earning valuable foreign exchange.
The organisation has already informed the concerned ministries that import of the formulation without technical registration is not allowed in several developed countries like the US, European Union, Brazil, Australia, Argentina and even China.
On the other hand, formulations manufactured abroad are not monitored. Technical issues are not checked for its quality. The formulation may have outdated technical issues, but it poses a major risk to human/animal health, environment and product performance.
Information obtained under Right to Information found that 97.3% of samples tested in accredited laboratories on an all-India basis in the last 5 years met the quality standards.
This increase in imports has seriously affected the domestic producers. So they have to stop working. Due to this, the policy of self-reliant India has been completely jeopardized by these hidden imports. An inter-ministerial meeting with the Ministry of Chemicals and Fertilizers also reiterated that there should be a minimum 10% increase in customs duty on imports of formulation and technical grade.
CCFI has always been pushing for a 30% duty on all finished formulation imports and a 20% customs duty on all technical grade imports for the agrochemical industry as Indian manufacturers have low technical capacity and untapped production potential.
(Except for the headline, this story has not been edited by ATM staff and is published from a web feed.)
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