India nuts for Californian dried fruit
By Arun Bhattacharjee
NEW DELHI - Afghanistan's struggle to emerge from the economic chaos left by the Taliban and the US-led "war on terror" has cost its supremacy in trading dried fruit with India, allowing United States traders to step in and fill the gap. But the Afghans are not the only losers. Pakistan, another supplier of dried fruit to the vast Indian market, has failed to cash in on the opportunity created by Afghanistan's absence, as it waits for trade barriers to fall and the peace process with India to move forward.
Helped by a liberalized economy that for the first time permits imports of fruit and dried fruit, Indians are finding that pistachios from California are bigger and taste better, and almonds have better tans and are juicier. India is the largest consumer of dried fruit in Asia; during its severe winters northern Indians prefer ground almonds in their milk and pistachios, always in short supply during the Taliban rule, to denote household status when served to guests. Soaked and sliced pistachios and almonds are used to garnish nearly 30 billion tons of Indian sweets - made mostly from milk and cottage cheese - annually. Green pistachio sweets are in great demand and sell at US$15-20 per kilogram during the hard winter months in northern India.
According to a non-official estimate by the Dry Fruit Sellers' Association of India, nearly 400 million Indians consume dried fruit, such as pistachios, almonds, dried plums, chilguzas (pine fruit) and dried apricots the size of crab apples directly, and another 400 million use them as additives for Indian sweets.
K K Kapoor, a third generation dried fruit trader in Delhi's Central Azadpur wholesale market, says they have imported 10 million tons of dried fruit this year, of which most comes from California. During his grandfather's time, he narrates, the distribution center for dried fruits was Peshawar in Pakistan, which used to supply dried fruits both from the northwest provinces of Pakistan and Afghanistan to Delhi. India used to import four varieties of raisins and six types of dried fruit from Afghanistan and Pakistan, mostly supplied by land route via Lahore to Delhi. Until the late 1970s and early 1980s, Afghanistan used to make up for the shortfall created by Indo-Pak trade barriers, but that advantage vanished during the war with Russia and the Talibanization of the country.
Currently, the size of India's dried fruit market is $1 billion, and growing at 20 percent annually, with a demand-supply gap of over 30 million tons. With taxes on dried fruit removed, imports have increased from 1 million to 10 million tons, and the market is ready for more, according to Delhi's dried fruit traders. Most of the traders are happy with shipments from California as they arrive on time and the supply is assured during the festival season that starts in October. They believe US suppliers are likely to have a captive and growing dried fruit market in India.
Another trader, R K Seth, who migrated to India from Peshawar during the country's partition, says the dried fruit trade in Delhi alone is worth $50 million during Dipavali (Festival of Light), when all the bureaucrats, politicians, friends, relations and business partners receive dried fruit packages as gifts.
A former Indian diplomat posted in Kabul says Afghanistan could have established and operated 100 high schools with its saffron petal sales to India; a market it lost along with its dried fruits. As the Afghan source dried up, India's $20 million saffron trade looked to Iran for supplies, but found the cost prohibitive. Even 20 years ago, five grams of Iranian saffron used to cost $40 and Spain stepped in as the supply from politically disturbed Kashmir became uncertain as well. Saffron is used to color and flavor the famous Indian biriyani (meat cooked with rice), sweets and ice creams.
Seth says that California has added variety to suit Indian tastes with new treatments for dried fruit. Now the pistachios come as green, salted or sweetened and almonds come in shells as well as in different treated forms. Also, California's sun-kissed brand of seedless raisins and black currants imported in bulk are sweeping Indian markets.
Apart from dried fruit, California faces almost no restrictions in exporting fresh fruit to the Indian market because of its strict pest control measures and health regulations. While Californian grapes, apples, plums and apricots are flooding the fruit stalls in Indian metros, Thailand, New Zealand and Japan are not allowed to export fresh fruit to India. India introduced from January 1 this year Pest Risk Analysis (PRA) as a pre-requisite to import fresh fruit from abroad within its Plant and Fruits Quarantine Act, which automatically outlawed all kinds of berries, Kiwi fruit from New Zealand, Japanese melons, apples, galangals and rambutan from Thailand. Australia recently received a reprieve and is allowed to export grapes, peaches, mandarins, oranges and plums. Bulk traders in fresh fruit at the Azadpur market claim that Californian fresh fruit, especially apples, seedless grapes and oranges, are more liked by consumers than the Australian varieties.
The traders feel that the cost of importing dried fruit and raisins from the US is higher mostly because of shipping charges. Although they sell at the price charged to US customers, they feel this is higher for Indians and those imported from Afghanistan. So far Australia, New Zealand and Japan have not entered India's dried fruit market in spite of the freight and cost advantages.
Although the new government policy against importing fresh fruit from these countries may keep them away for a short period, they are eventually likely to compete with the US in both dried and fresh fruit, given their cost advantage. Sources in India's Ministry of Commerce explain that Australia, New Zealand and Japan are taking steps to meet India's health and pest control needs and they will enter the Indian market, perhaps by the end of 2005, when Californian exporters might have to consider new pricing of their bulk as well as packaged products to retain their unforeseen advantage, partially created by the political and economic environment in Afghanistan.
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