US tariffs likely to impact Indian seafood shipments adversely: Exporters
Amaravati (PTI): Seafood Exporters Association of India (SEAI) president G Pawan Kumar on Sunday said the reciprocal tariffs announced by US President Donald Trump will have a severe adverse impact on Indian seafood exports to the US market, whose value stands at USD 2.5 billion in 2023-24.
Out of the total seafood exports to the US, shrimps accounted for the lion’s share of 92 per cent and India is the largest supplier of shrimps to the US, Kumar said.
"This tariff will hurt all stakeholders in the value chain and cause all round distress," Kumar told PTI.
The county will falter in export performance when compared to the South American nation Ecuador, which is levied only a 10 per cent tariff, it is believed. Vietnam with a reciprocal tariff rate of 46 per cent and Indonesia with 32 per cent will concede a massive advantage to the South American country, he said.
According to Vizag-based Kumar, Ecuador is likely to replace India as the largest shrimp supplier to the US market.
"It will be difficult for Indian seafood exporters to absorb this margin of 16 per cent and compete with produce from Ecuador. The prevailing margins in this sector are 4-5 per cent only," he said.
The higher tariffs come into effect from April 9 as 2,000 containers of seafood are currently in transit to the US market, he said.
Kumar underscored that the tariff impact that will have to be borne by exporters in India is estimated to be around Rs 600 crores while an equal number of containers in cold storage are waiting for shipment.
As export orders are on delivery at doorstep basis, the impact of tariff will have to be borne by exporters for goods in transit, said Kumar, adding that this will pose a huge additional burden on shippers.
Further, the requirement of giving a bond and meeting other conditions of the US government will eat into the working capital of the exporters, causing financial distress and cash flow disruptions.
Besides the reciprocal tariffs, Kumar said, there exists a 5.77 per cent countervailing duty and 1.38 per cent anti-dumping duty levied by the US Department of Commerce on all shrimp imports.
"All these have resulted in tightening of margins for exporters in recent times. This levy has come just before the start of the first season of the culture of shrimps," said Kumar.
The uncertainty over the impact of tariffs on margins will lead to a lesser number of orders placed with farmers and consequently, the requirements from hatcheries will also remain subdued, he said.
The SEAI president requested the Centre to intervene urgently with measures to support the sector until the tariffs are reduced to previous levels, or until a bilateral trade agreement is reached.
Meanwhile, Andhra Pradesh Fisheries Department joint director Lal Mohammed said the government will organise stakeholders meetings on how to mitigate the impact of tariffs on the sector.
Other strategies the government is contemplating include educating aquaculture players on breeding other species of fish of equal export value and scouring alternative markets such as China, South Korea, Russia, the European Union, Australia and others.
Mohammed noted that raising domestic consumption, increasing shrimp retail outlets, producing value-added products which are ready to cook and eat, improving quality and declaring antibiotic-free shrimps with traceability, among others will also help.
Andhra Pradesh is a major seafood production hub, where more than 5.7 lakh acres are under aquaculture, led by Eluru, West Godavari and Krishna districts.
Vannamei variety of shrimp is bred in more than 2.5 lakh acres in the state.
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India describes attack on Fujairah 'unacceptable'
New Delhi (PTI): India on Tuesday described the wounding of three Indians in an attack on the United Arab Emirates' port city of Fujairah as "unacceptable" and pressed for an immediate cessation of hostilities targeting innocent civilians.
New Delhi's reaction came a day after the Indians were injured after a drone attack caused a fire at a major oil industry zone in Fujairah. The UAE had accused Iran of carrying out the strike.
"The attack on Fujairah that resulted in injury to three Indian nationals is unacceptable," External Affairs Ministry spokesperson Randhir Jaiswal said.
"We call for immediate cessation of these hostilities and the targeting of civilian infrastructure and innocent civilians," the spokesperson said.
Jaiswal said India continued to stand for dialogue and diplomacy to deal with the situation so that peace and stability could be restored across West Asia.
"We also call for free and unimpeded navigation and commerce through the Strait of Hormuz in keeping with international law. India stands ready to support all efforts for a peaceful resolution of issues," he said.
The attack on Fujairah city came as the ceasefire between the US and Iran came under strain in the Strait of Hormuz.
The Strait of Hormuz, through which roughly one-fifth of the world's oil and gas pass, remains a major sticking point in the talks. Shipping through the narrow Gulf waterway has been severely disrupted by the conflict, triggering a sharp increase in oil prices and energy shortages in several countries.
The UAE's defence ministry on Monday said its air defence systems engaged 12 ballistic missiles, three cruise missiles and four drones launched from Iran.
The ministry affirmed that it "remains fully prepared and ready to deal with any threats and will firmly confront anything that aims to undermine the security of the country."
