Import of agriculture commodities in India has increased dramatically from US$1.4 billion in 2004-05 to US$3.4 billion in 2007-08 (Fig 1) mainly due to adoption of safety standards in India in 2003-04. Implementation of the safety standards should actually have led to a decline in imports but in India this has resulted in an increase in imports of agriculture commodities. This increase in imports has been of lower quality of imported products which are still not compliant with these standards. In order to safeguard the economy from the harmful effects of exotic (foreign) living organisms in the imports, the SPS agreement of WTO allows Member countries to adopt safety standards. However, several developing countries use them as protective measure rather than as safety measures.
Figure 1: Imports of Agriculture Commodities in India
Source: Export and Import Databank, Directorate General of Foreign Trade, GOI In India, the regulations governing the imports of agriculture products are in line with international standards. The Plant Quarantine Order (PQ Order), 2003, lays down regulations for import of plant/plant material into India so as to safeguard plant, animal and human life from exotic insects. To ascertain which agricultural products can be harmful for India, a Pest Risk Analysis (PRA) is conducted on agricultural products likely to be imported. Prior to the PQ Order, PRA was done on less than 100 commodities. After implementation of PQ order in 2004, PRA of commodities increased steadily and by 2007-08 there were 900 commodities on which such analysis had been conducted. Even though the Indian safety standards are at par with international standards the quality of imported agriculture products still remains non compliant due to weak implementation of these standards.
In a survey on non-tariff barriers faced by importers of agriculture products into India, it was found that testing required to be done at ports is not carried out by the concerned authorities and consignments are often released on payment of bribes. There are several instances when imports did not meet safety standards. For example, in 2006-07, due to an acute shortage of wheat the government of India banned its exports and allowed free imports. Consequently, in 2006-07 imports of wheat reached the maximum level in the past seven years and touched US$ 1,292 million. Wheat imported in 2006-07 faced severe criticism on grounds of quality. It was widely reported that laboratory tests conducted on the wheat subsequent to its import was found that it was unsafe for human and animal consumption, as it contained harmful chemicals such as organo-phosphorus compounds like Malathion and hydrogen phosphide used as insecticides and pesticides. Also, the imported wheat was found to have weeds, fungus infections and pests. The wheat imported from one of the Cairn group of companies in the Asia Pacific region was found to have two kinds of fungus infections, one insect pest and 14 weeds, of which 11 weeds were exotic to India. This has happened despite the requirements of the PQ Order in India.
The SPS rules for imports of agriculture products are in line with international standards, however, these standards fail to meet the stated objective as the government has a weak implementation process. Enforcement of regulations is weak not only for imports but also for domestic products. This could be a reflection of the general apathy towards health and safety. It is necessary to change this mind-set and have a strong implementation of standards to protect the economy from the pervasive damage that can be caused by exotic pests and insects.