Expatriates from Kerala who are longing to savour Onam dishes with vegetables from their home land may be disappointed this time. Daily vegetable and fruits exports from Kerala to West Asian countries and Europe have come to a grinding halt. Shooting prices of commodities at sourcing market centres and the advent of GST, which alone has jacked up the total air freight by a flat 18 per cent, have proved to be disastrous for operations. From last Wednesday, exports have come to a virtual standstill.
Through the three airports at Thiruvananthapuram, Nedumbassery and Karipur, around 140 tonnes of vegetables were being flown daily, mainly to the UAE, Saudi Arabia, Kuwait and Qatar.
Including 40-50 exporters based in the state, select farmers in Kerala and neighbouring states catering to the export market and thousands of associated workers, not less than 10,000 people are directly involved in the vegetable export trade. The annual turnover of vegetable exports to West Asia and Europe from the state is around Rs 600 crore.
The heartburn of vegetable exporters is the absence of a strong IT platform to refund the remitted GST amount. Earlier, vegetables and freight for transporting it to domestic markets or for exports had attracted zero per cent tax. But under GST regime, the freight cost is summed up with GST and the tax amount is refunded later, the first pay and get refund principle. Overseas buyers, with whom exporters from Kerala and elsewhere have entered into a long-term cost and freight contract, are neither bothered to attend the pleas based on the GST induced issue nor the unique scenario in vegetable prices this year, which keeps escalating against the backdrop of heavy shortfall in production in cultivating states. Irrespective of the value of the commodity, every single kg of vegetable variety sent abroad in passenger flights attracts an approximate freight of Rs 52 and 18 per cent GST now.
“With monsoon playing truant and floods wreaking havoc in some places, the supply chain has been badly hit and prices are soaring. The heavy domestic demand despite rising prices is another factor. GST has compounded the problem,” said Dil Koshy, secretary, Agricultural Products and Processed Food Exporters’ Association (APPEXA).Every day, nearly 50 Gulf-bound passenger flights carry vegetable loads in the cargo hull. Thiruvananthapuram tops the volume with 70-80 tonnes, followed by Nedumbassery (50 tonnes) and flights from Karippur airport (20 tonnes).
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