Will set up market facilitation centres in Dubai and Tokyo, in addition to the one in the Netherlands.
KOLKATA: The government is planning to set up two more market facilitation centres (MFCs) in Dubai and Tokyo to help flower exporters.
R K Boyal, general manager, Agricultural & Processed Food Products Export Development Authority (Apeda), said these two centres would advise flower exporters on quality and other key parameters.
The new facilities will be in addition to the one in the Netherlands. Experts, however, say in the $65-billion global floriculture market, India’s share of 0.01% could wilt if the import duty on exports weren’t rationalised.
Cut flowers from India face a higher import duty in Europe during the non-peak months of May-October. In November-April, when demand increases, the tariff is lowered by 5-6%, putting Indian horticultural products at a distinct disadvantage during these crucial months.
Importers’ duty is 12% if the certificate of origin is not sent and 10% if the same is sent in summer and 8.5% and 7.2% in winter, respectively. On the other hand, most of the competitors in Hungary, Israel, Poland, Columbia and Equador enjoy zero duty.
Those in the floriculture trade say the market is highly competitive and, therefore, the cost of production must be reduced by achieving economies of scale.
Indian flowers are mainly exported to the US, UK, Netherlands, Japan and Germany. However, the selling points in these consumption markets are gradually shifting from speciality stores/florists to supermarket chains like Wal-Mart, Sears, K-Mart, TESCO, etc.
Rajeev Singh, secretary-general, Indian Chamber of Commerce (ICC), said India’s infrastructure did not support easy movement of perishable items like flowers. “Once the exported flowers land in overseas markets, if the consignment is for a client, then the latter takes over. If the consignment is to be distributed by the exporter, he needs an efficient distribution network,” he adds.
Since 90% of the farmers are small and marginal, cultivating on 1-10 hectares, the financial wherewithal is almost nil in most cases. However, M P Nair, regional manager, (Apeda), said the market facilitation centre (MFC) at Aalsmer, Netherlands, was set up for consolidating export marketing efforts of the Indian growers, especially the smaller ones. “This has enabled them to supply large quantities of flowers directly to large buyers round the year,” he claimed.
According to industry sources, the Indian floriculture market is worth about Rs 2,000 crore and growing at about 21% a year.
m_madhumita@dnaindia.net
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