Iranian apples in Afghan 'clothing' make Kashmiri growers see red

Kashmir exports 2 million tonnes of apples annually, generating Rs 8,000 crore in revenue. (Photo by Irfan Amin Malik)

Apple grower Mohammad Amin, 45, is worried. His anxiety has grown over the last three weeks as demand for Kashmiri apples has slowed in Delhi’s Azadpur Mandi.

“Over 40 percent of the apple production is yet to be sold because the rates aren’t up to expectations and demand for Kashmiri apples has decreased due to illegal trading of Iranian apples in India,” Amin told Moneycontrol.

Amin lives in the Pinjoora area of South Kashmir’s Shopian district and owns over 40 kanals (5 acres) of apple orchards. Like Amin, Mudasir Ahmad Bhat of North Kashmir’s Sopore is worried about Kashmir’s apple industry.

On January 1, 2022, Bhat, along with dozens of fruit growers, assembled at Asia’s second-largest fruit mandi (market) in North Kashmir’s Sopore and staged a protest against the influx of Iranian apples.

The growers and traders here and in other parts of India have voiced their concern over the “illegal trade” in apples from Iran via Afghanistan, abusing the South Asian Free Trade Area (SAFTA) pact.

Vijay Kumar, General Secretary of the Azadpur Mandi, told Moneycontrol that an apple box from Kashmir weighing 16 kg sells for Rs 900-1200, while an Iranian apple box of 10 kg sells for Rs 550-700

Bhat confirmed the rates, noting that demand for Indian apples has been affected.

Apart from J&K, apples are grown in Himachal Pradesh, Uttaranchal, Arunachal Pradesh and Nagaland. The illegal trade is also hitting the growers of these States.

Indian growers say that Iranian apples sell like “hotcakes” due to lower rates, while the demand for homegrown apples has decreased.

The Iranian apples, they say, will ultimately hit the Kashmiri apple’s market share in the coming years unless the imported fruit is taxed.

“The Government needs to take some action, otherwise this industry will be nowhere,” Bashir Ahmad Basheer, President, Kashmir Valley Fruit Grower Cum Dealer Union, told Moneycontrol. Basheer claims over one crore apple boxes in the valley are lying unsold after Iranian apples hit Indian markets.

On December 15, 2021, the association wrote to the Union Agriculture Minister and apprised him of the “illegal trade” and how it is affecting farmers in Kashmir and other parts of the country. It noted the abuse of the zero import duty SAFTA pact and consequent loss of tax revenue, calling for an immediate ban on the import of Iranian apples using this route.

The South Asian Free Trade Area (SAFTA) is an agreement between eight South Asian countries. Both Afghanistan and India are members of SAFTA and hence do not impose duty on certain imports from each other.

While Iran is not part of SAFTA, apples from that country reach India via Afghanistan, bypassing import duties.

“That is why it is illegal and must be stopped,” says Mudasir Ahmad Bhat, who is also the president of Fruit Buyers Union of Sopore.

Ajaz Ahmad Bhat, Director General, Horticulture, Kashmir, told Moneycontrol that although the issue has been taken up with higher authorities, not much can be done. “You can’t stop an international treaty and trade,” Bhat told Moneycontrol.

The Iranian apples reach New Delhi’s Azadpur mandi through the Wagah border with Pakistan, from where they are distributed to other States.

According to reports, Iran had an apple glut during the 2020/21 apple season (August-July) and exported 74,900 tonnes of fresh apples to India, a three-fold jump.

Azadpur Mandi General Secretary Kumar confirmed to Moneycontrol that Iranian apples have been arriving at the mandi, hitting homegrown apples. He said that over two lakh tonnes of apples, worth Rs 200 crore, are lying in cold storages in New Delhi.

“Our cold storages can hold the production for over 3-4 months. I hope the demand-supply (situation) does not break down completely,” Kumar told Moneycontrol.

Cold-storage owners charge growers Rs 200 per box.

“I am being told that the Iranian apples arrive in containers via ports also,” he added, noting that they first started arriving in India last year.

The Jammu and Kashmir government says that horticulture has a vital role to play in the J&K economy, with a yearly turnover of Rs 1,200 crore. It provides direct and indirect employment to about 23 lakh people.

According to government figures, apple production in Jammu and Kashmir stood at 19.4 lakh tonnes in 2017-18. In 2018-19, it rose to 20.9 lakh tonnes and in 2019-20, fell to 19.5 lakh tonnes.

Kashmir exports 2 million tonnes of apples annually, generating Rs 8,000 crore in revenue.  There is no fixed rate for the apples, which varies for the A, B and C grades — apples are graded in terms of size, color, shape and quality — and across markets.