Imports from China killing our farmers

While Indian farmers are forced to dump tomatoes in the streets, Indian food processing industry merrily imports cheaper tomato paste from China



Not able to get the right price for tomatoes, farmers often resort to throwing away the produce -- The Hindu pic
Some decades back, soon after the Ministry of Food Processing was set up in prime Minister Rajiv Gandhi's tenure, I was speaking at the M S Swaminathan Foundation in Chennai. While most speakers were busy hyping the importance of food processing in reducing food wastage, which I am not in disagreement, I stressed on the need to ensure that the nascent food industry focuses more on sourcing local farm produce in processing rather than importing the food concentrate. Illustrating the point I made, I gave an example of the orange juice being made available in tetra-packs.

At that time, I remember one of the popular orange juice brands had it written on the tetra-pack: "Made from freshly picked up oranges from California."

I am sure you will agree that if the orange concentrate is to be imported from California, all the talk of reducing food wastage becomes meaningless. Soon after my viewpoint was carried prominently by the media, the processing house at least dropped this sentence from their juice cartons.

Yesterday, on a visit to a food processing unit in Sonepat district in Haryana, I was shocked when I was told that tomato paste is being imported in large quantities from China. In fact, most of the big brands of tomato ketchup and tomato puree are using imported paste and pulp from China. This is happening at a time when farmers are repeatedly being forced to throw tomatoes onto the streets for want of buyers. This year too, when food inflation was at its peak, reports of dumping of tomatoes by farmers had poured in from several parts of the country, including Himachal Pradesh, Punjab, Haryana, Uttar Pradesh, Karnataka and Andhra Pradesh.

With tomato prices crashing to Rs 2 (and at several places to Re 1 per kg) farmers had no choice but to feed it to cattle or to throw it away.

This was happening at a time when the tomato processing industry was merrily importing tomato paste and up mainly from China. While politicians, TV commentators, editorial writers stressed on the need to strengthen food processing, not many know that the existing tomato processing industry was relaying heavily on cheaper import of pulp and paste. This is not the first year for such imports, a review of reports on Google showed that such imports are continuing over the years.

Not many know that the popular brands of tomato ketchup, tomato puree and even tomato juices that we consume at home are made from tomatoes imported from China, Nepal, Italy, USA and the Netherlands. In other words, we are inadvertently helping tomato farmers of the countries from where we import while our own farmers are left to die.

Just in one month, between Aug 28, 2014 and Sept 28, 2014, India imported US $ 376,009 worth of dried tomato and tomato products (like paste, pulp and juice concentrate) from China, followed by US $ 94,057 worth of imports from Nepal, and US $ 44,160 from the Netherlands. Some more research, and I find that in 2010 when traders were eyeing the market opportunities in Pakistan arising from devastating floods, the Indian processing industry was busy importing tomato paste from China. A news report in the Economic Times (Oct 20, 2010) quoted Pradeep Chordia, managing director Chordia Food Products Ltd saying: "We can't afford the high local prices so we imported 80 per cent of our requirement of tomato paste from China this year."

Another food processor, Akshay Bector of the Ludhian-based Rs 400-crore Cremica Group said: "There is a cost advantage in buying from China versus India where prices fluctuate." This company supplies to McDonalds, Taj Group, ITC Group, Jet Airways, Indian Airlines, and chains such as Barista, Cafe Coffee Day, Pizza Hut, Domino and Papa John's.

Go back a little more, and you find a lot of Indian companies importing tomato paste way back in 2005, and even before. No wonder, tomato farmers in India have been at a great disadvantage for several years now, if not decades.

I therefore have three suggestions:

1. Ministry of Food Processing should encourage food processors to mention on the label the place from where the raw material is being sourced. Traceability is now an important trade issue.

2. It should be made mandatory for the food processing units to source the raw material that is available in India, from domestic sources. This is the only way to develop the back-end infrastructure that will help reduce farm wastage.

3. A minimum support prices should be announced for tomato which should serve as a floor price for the markets.