In a recent development, the United States has alleged that shrimp exports of India are subsidized, prompting concerns over potential anti-dumping (AD) and countervailing duty (CVD) duties. If India fails to dissuade the US from imposing these duties, the cost of Indian shrimp exports to America may surge by 6 to 10 percent.
The American Shrimp Processors Association (ASPA) initiated this move by urging the US Department of Commerce to impose duties on shrimp imports from specific countries, citing harm to local fishermen. Last month, the department accepted this request and launched an investigation into shrimp imports from India, Ecuador, Indonesia, and Vietnam, which collectively account for 90 percent of shrimp imports to the USA.
India, with an annual shrimp exports value of approximately USD $2.4 billion, faces a significant impact if the US decides to impose duties. Gujarat alone contributes around USD $72 million to this export value. The Seafood Exporters Association of India (SEAI) and the Marine Products Export Development Authority (MPEDA) are actively engaging with US agencies, providing necessary data, and countering allegations put forth by ASPA.
Jagdish Fofandi, the Vice President of MPEDA and President of SEAI, addressed ASPA’s claim that Indian exports are subsidized by the Indian government through the RoDTEP scheme. Fofandi emphasized that they are working to convince US authorities that the scheme aligns with WTO compliance and aims to reimburse domestic taxes for exporters.
Should India fail to persuade US authorities and duties are imposed, it could have severe consequences for Indian exporters. The proposed 6 to 10 percent duty would increase the cost of Indian products in the US market, necessitating a reduction in procurement prices and directly impacting Indian fishermen.
This development adds to the challenges already faced by Indian exporters, including the economic slowdown in China (which receives 50 percent of exports from Gujarat) and sluggish demand from the inflation-affected European market. With restaurant attendance declining during the period of increased demand for Indian fish, the situation poses a double challenge for marine exporters in India.
