Squeeze on Afghan spices, dry fruit imports to pinch India; prices likely to soar

A geo-political crisis in the western neighbourhood could turn the heat on in the Indian kitchen as supply of aromatic asafoetida, a particular variety of cumin used in ‘biryani’, dry fruits including figs, apricots and green and black raisins has been halted suddenly. With lower customs duty on products from Afghanistan and long-term supply arrangements in place, traders have refrained from reaching out to alternate destinations, but fear domestic prices might soar.

Taliban had last week sealed two terminals crucial for trade through land on the Pakistan-Afghanistan border. “Many of these items that we import from Afghanistan are not available anywhere else and even if they are, they would be imported at a cost as we are able to import duty-free under South Asian Free Trade Area (SAFTA) till now,” said Vijay Kumar Bhuta, president, Dry Fruit Traders Association.

While India imports dried apricots from Iran, Turkey and Pakistan, Afghanistan supplied more than 85% of the nutritious dry fruit to India in FY21. Similarly, 99% of fresh and dried figs in India came from Kabul last fiscal.

Besides, figs, apricots, and green and black raisins, smaller amounts of pistachios and almonds too make their way into the country from Afghanistan. Among spices, hing, and a particular variety of cumin used in biryani, comes from Afghanistan, though China is the largest supplier of cumin seeds (neither crushed nor ground) followed by the UAE.

An overwhelming 80% of India’s imported hing comes from Afghanistan, which is of superior quality than the Iranian one. Though it is now cultivated in its neighbouring nations of Tajikistan and Uzbekistan, India doesn’t have trade agreements with them to enjoy any duty benefits. “We are in wait-and-watch mode, but this needs to get resolved before Diwali. Our counterparts in Afghanistan too have shut shop for the time being. Till we resume imports, consumers can expect a 10-15% rise in prices,” said Bhuta.

Traders have reached out to the government, hopeful of an early resolution to the halt of the trade route.

In 2011, India removed basic customs duties for all least developed countries (LDC) in the South Asian Association for Regional Cooperation, which gave all products of Afghanistan, except alcohol and tobacco, duty-free access to the Indian market. As an LDC, Afghanistan is signatory to SAFTA and is required to lower tariffs of all goods not on its sensitive list to 5% or less. The two countries signed a Preferential Trade Agreement in 2003 under which India allowed substantial duty concessions to certain categories (38 times) of Afghan dry fruits. Afghanistan in turn allowed reciprocal concessions to Indian products, including tea, sugar, cement and pharmaceuticals.

“Banking facilities are closed in Afghanistan and there are no customs officers to clear consignments and grant the required certifications,” said a Mumbai-based importer of fresh and dried fruits.