1. FISH IN INTERNATIONAL TRADE
Problems, Barriers & Restrictions
By
Saswata Maitra

2. Even after, being a heavy export earner to the tune of 2.60
billion dollars, the fisheries sector of India is facing
numerous problems on account of-
 economic shortcoming,
 technical constraints
 institutional limitation
 trade restrictions and
 marketing lacuna
 Severe competition exist between the different
competitors like Thailand, China and South East Asian
countries for sustaining the market share.
However these are too broadly classified, and it would take
a closer inspection to correctly identify the problems of
Indian seafood export trade industry of modern times.

3. According to the study conducted by CMFRI from 2009-
2011 the following were listed as the major concerning
trading Problems faced by the Indian Seafood exporters-
 Irregular supply of raw material
 Cut throat competition for raw material
 Heavy competition for target market
 Low capacity utilization
 Higher cost of production and low margin of profit
 Uncertainty in Prices
 Dictatorship of buyers
 High cost of investment
 Lack of market and product information

4.  Irregular supply of raw material-
Unpredictability of landings and production:- The major
exportable species like shrimps, lobsters and high value
fishes registered a downward trend in landings over the
years . There has also been a significant reduction in
shrimp production due to disease outbreak and huge cost
of shrimp farming. In addition, the seasonal variations in
marine catches constrain the operations of the firms.
 Cut throat competition for raw material -
Nominal prices of raw materials much above the real
prices:- The peak landings in the marine capture sector
generally coincide with the peak season for exports.
More than 60 per cent of the landings occur during the
post monsoon period which coincides with the highest
export demand. As a result the raw materials are often
purchased at exorbitant prices at these times.

5.  Heavy competition for target market –
Too many exporters chasing too few markets:- There exists very
huge competition for gaining access to the target markets.
Japan, USA and European Union or Western Europe were the
major fish importers from India, which accounted for about 60
to 65 per cent of the volume and about 70-75 per cent in value
of Indian seafood export.
 Low capacity utilization-
More and more capacity generation leading to less and even
lesser utilisation:- Realization of the capacity utilization was
the major problem faced by them and the average capacity of
the processing plan was found to be 32.12 tonnes whereas
the utilization was only 12.10 tonnes (37.70) percent. It was
found that during the period from October - December months
contributed to 30.39 per cent followed by January- March at
28.29 per cent. The processing plants processed minimal
quantities during the period during July-August and April-June.

6.  Higher cost of production and low margin of profit-
The cost of production increased exorbitantly on account of
high purchase prices of the exportable species and other
operating expenses like labour cost, water and electricity
charges. The high cost incurred for purchase at distant
markets, compliance cost, establishment cost all resulted
in higher unit cost of production and lower profit level.
 Uncertainty in Prices –
Erratic global markets and demand habits:- There exists
uncertainty in prices in the international market with the
economic recession spreading to most of the target
markets. The price uncertainties lead to delay in
payments, loss in revenue and getting delayed in
shipment and increased demurrages.

7.  Dictatorship of buyers –
Paradox of buyers becoming price makers:- The export
market is necessarily a buyers' market with the prices
fixed by the international buyers . The absence of-
domestic demand coupled with the premium prices in the
international market makes the products disposal at the
whims and fancies of the importers. The exporters thus
became a price taker than a price maker.
 High cost of investment –
Break evens are waiting for the long run:- The
establishment cost of a processing plant increased
considerably over one years due to stringent quality
standards Set by international trade regulations. The
compliance cost for EU approval also Increased manifold
thus resulting in huge cost of establishment.

8.  Lack of market and product information –
Lag in market intelligence and poor market news:-The lack
of market and Product information leads to demand and
supply constraints. The taste and preference, of the
buyers ever changing, that it becomes difficult to coup up
with their demand. The lack of proper market intelligence
and poor market news leads to the rag In equipping the
seafood traders.

9. BARRIERS TO SEAFOOD TRADE IN INDIA
 Barriers in seafood trade in India can generally be
classified under two categories:-
 In terms type of trade-
 Import barriers, &
 Export barriers
 In terms of regulations:-
 Tariff barriers, &
 Non tariff barriers

10. IMPORT BARRIERS
 Import barriers are not common in India due to the non
requirement of sea food import. It is however quite common in
case of ornamental fish import-
 Non-Tariff Barriers on Imports- In order import fish , one
requires a special import permit (SIP) creating immense
amount of hassles for the importer. Also raises the possibility
of corruption on the part of the officials in charge. Sometimes
when the permits takes considerable time that adds to the cost
of storage of fish at the port.
 Barrier on Ornamental Fish Imports- . Only limited varieties
of fishes are allowed. Rules also appear to be more stringent
than most countries across the globe. But due to the
increasing demand for ornamental fish from the corporate
sector, they are often brought through the illegal routes leading
to corruption.

11. BARRIERS ON EXPORTS
 Barriers From EU (European Union)-
 Harmonisation of testing procedures
 Rejection on account of bacterial inhibitors/ unspecified
antibiotics
 Rapid Alert System
 Destruction of Consignments
 Barriers From US-
 After the events of September 11, 2001, US Congress
passed the Public Health Security and Bioterrorism
and Response Act of 2002. This Act created an indirect
barrier for seafood exports from India as inspections
increased.
 Indian export consignments have also been rejected
under country of origin labelling norms.

12.  While catching shrimps it needs to be ensured that sea
turtles are not killed. In 1996 USA banned imports from
India accusing that Indian fishermen do not use turtle
excluder devices.
 Tuna exports need to have dolphin safe catching
procedure labelling.
 Barriers imposed by other countries on Indian
exports-
 Saudi Arabia have been imposing a ban on India since
1984, as WHO reported India as a country affected by
cholera at that time.
 Chinese authorities do not have details of their norms.
 Revised quarantine measures to be imposed by Australia
on prawn imports also creates barriers to Indian
exporters.

13.  Environmental restrictions in seafood export-
1. Sanitary and Phytosanitary Measures
2. Anti-dumping measures
3. Subsidies and countervailing measures- criticality on
the existing management regime and the bio-economic
circumstances of the relevant fishery. Pertains to the
problem of overfishing.
4. Technical barriers to trade and point of origin-
producing or catching of fish following proper
environmental procedure or else facing trade conflicts.
5. Non-governmental efforts to promote marine
conservation
6. Government sponsored labels and traceability

14.  Previous years questions-
 What are the problems faced by the seafood export
trade in India? Mention some suggestive measures to
overcome such problems. (2006)
 What are the barriers to the seafood trade in India?
(2009,2010)

15. REFERENCES
 CONSTRAINT ANALYSIS ON THE IMPEDIMENTS FACED BY
INDIAN SEAFOOD EXPORTERS, Salim.Shyam.S. and Aswathy.
N, Socio- Economic Evaluation and Technology Transfer Division
Central Marine Fisheries Research Institute. Cochin, 2011
 Fisheries Trade in India: Understanding Potentials and
Barriers, Rajeev M. Institute of Social and Economic
Change, Bangalore, India in collaboration with Norwegian Institute of
International Affairs, 2007
 Asche F. & Smith. Martin D., Trade and Fisheries: Key Issues for
the World Trade Organization, World Trade Organization-
Economic Research and Statistics Division, January 2010
 Seafood Export Journal, September 2011 issue.
 Wikipedia the free encyclopedia, http//www.wikipedia.com
 FAO- www.fao.org/fishery trade

16. THANK YOU