Double bonanza for the aquaculture sector in the Union Budget

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In the Union Budget 2024, the finance minister made some significant announcements to facilitate the growth of the aquaculture industry. India is the third-largest fish producing country, contributing around 8 percent to the global fish production. In FY23, India generated a record high forex revenue of Rs 55,000 crore by exporting seafoods. Exports, in terms of quantity, jumped 27 percent YoY.

India mainly exports frozen shrimps, which contributed 40 percent in terms of volume and 70 percent in terms of value. Fish, cuttlefish, squids, dried items, and live and chilled items comprise the rest. Frozen fish, the second-largest exported item, fetched over Rs 5,500 crore. The US, Europe, and China turned out to be the major importers of India’s seafood.

In 2020, the Government of India had launched the Pradhan Mantri Matsya Sampada Yojana (PMMSY) to transform and facilitate the growth of the fisheries and aquaculture sector.  The scheme had an investment outlay of Rs 20,000 crore (from 2020 to 2024-25).

The government remains committed to double aquaculture exports to nearly Rs 1 lakh crore and generate over 50 lakh job employment opportunities in the rural economy over medium term. In Budget 2024, the finance minister announced an allocation of Rs 20,000 crore to the Fisheries and Aquaculture Infrastructure Development Fund (FIDF). Development and the modernisation of breeding centres, aqua parks, shrimp farming, processing units, fishing harbours, landing centres, fish markets, fish-landing centres, cold chain infrastructure, and logistics will strengthen the productivity and yield of the aquaculture sector. The financing for the same will be supported by the National Bank for Agriculture and Rural Development (NABARD).

To enhance cost competitiveness, the finance minister also announced a significant reduction of Basic Customs Duty from 15 percent to 5 percent on certain feedstock, polychaete worms, and shrimp & fish feed.  Besides, various inputs (Krill Meal, Fish lipid oil, Crude fish oil etc.) for the manufacture of shrimp and fish feed will be exempt from customs duty.

The efforts to strengthen the aquaculture, mariculture and allied sectors will contribute to the growth of the rural economy and increase farmers' incomes. Apex Frozen Foods, Avanti Feeds, and Waterbase, which operate in the marine value chain, stand to benefit from these developments. Avanti Feeds is the market leader in domestic shrimp feed and a key exporter of processed shrimps. While Apex Frozen Foods is an integrated producer and exporter of frozen shrimps, Waterbase is a key manufacturer of shrimp and prawn feed.