Times Agricultural Journal

Sanitary and Phyto Sanitary agreement (SPS) under WTO deals with food safety and plant and animal health issues. Spices, being a food item, are subjected to the conditions of the SPS agreement for international transactions. Though the stated objectives of the agreement do not discriminate between nations, in practice, high level protection prevails in certain developed countries. SPS measures demand higher investment in developing countries to upgrade their systems and achieve universal standards (Codex) or those standards stipulated by importing countries. There is also a possibility of developed countries shipping commodities, which are not allowed to be sold in their own markets, to the developing/least developed countries.

Unfortunately, our present legal provisions relating to many elements that constitute SPS measures, are insufficient. India does not have a National Standard covering all the requirements of the agreement under SPS measures. The regulations under AGMARK are only optional and not mandatory and are not even comprehensive. Similarly, the provisions existing under the PFA act are also not comprehensive and provide loop holes for import of cheap spices from other countries of origin. Under both the legislations, there is absolutely no reference to pesticide residues.

Spain has set maximum residue levels for some 30 pesticides in spices and spice products while Germany has some 40 specifications as far as MRLs are concerned. Netherlands and the UK have some 25 MRL prescriptions. Japan has prescribed 16 MRLs and Australia has 21 MRLs. These MRL standards vary in severity from country to country. For instance, for ethion, it is 0.05 ppm in Australia, 0.1 ppm in Spain & Germany and 1 ppm in the US. Some MRLs, particularly those in Australia, are close to minimum detection levels. The major chemicals of concern in the importing countries are ethion, chlorpyriphose, cypermethrine, triazaphos and quinalphos. Out of these, ethion and quinalphos are manufactured and sold under a regime of ‘deemed registration’. Cypermethrine and triazaphos though registered are not recommended for application in chillies but are widely used. Indian consignments of chillies are regularly being retained in the ports of call of Australia and EU countries especially Spain. The EU has recently put Indian chillies under ‘rapid red alert’. Out of the 164 molecules registered in the country, 26 are produced under ‘deemed registration regime’ and the situation has continued over years. This system of registration would certainly have an adverse impact on the spices export from the country in the long run. A data base needs to be created with respect to major pesticides used in individual spices crops to finalise the MRLs and to develop a national codex standards by the ministry of health. This is a preliminary step to arguing the country’s case, where the nature, scale and technological status of spice production in the country differs from that of other producing countries.

Another serious concern is the presence of aflatoxins, mainly related to poor post-harvest handling. This can be addressed through training and infrastructure development for improved and hygienic handling of produce at farm level and its proper packaging.

Article 9.1 of the SPS agreement provides for extension of technical assistance to developing country, either bilaterally or through the appropriate international organisations to create capacities in maintaining required level of SPS. Assistance can be in the areas of processing technologies, research and infrastructure, establishment of regulatory bodies, training and equipment. In the area of spices, it is necessary to initiate action in this direction to get such assistance from major developed importing countries.

The major non-tariff trade barrier that seriously affects Indian export of spices is the presence of pesticide residues, expressed as Maximum Residue Limits (MRLs). USFDA has prescribed MRLs for several spices. The EU is yet to finalise the MRLs for pesticides in spices and spice products.

The following are the policy initiatives suggested to achieve a competitive advantage for Indian spice exports:

The Pesticide/Insecticide Act should be amended at the earliest to empower the Government of India to ban molecules as and when necessary.
Stoppage of manufacture and sale of pesticides which are not registered and keeping a strict vigil against the use of spurious and cocktail pesticides in spice production (eg. chilli).
Immediate stoppage of the present practice of giving deemed registration to pesticide manufacturers.
The responsibility of generating field trial data should be fixed squarely on the manufacturers of pesticides/insecticide before granting registration.
Identifying the commodities/pesticide combinations for which MRLs are to be fixed by the Codex and EU. The Spices Board has recommended this combination for six spices to the ministry of agriculture, Govt. of India.
The ministry of agriculture, in consultation with pesticide manufacturers, should develop toxicological data within a time frame for passing it over to Joint Meeting of Pesticide Residues of Codex (JMPR).
The ministry of agriculture should discuss with the pesticide industry the development of MRLs based on supervised trials.
The ministry should also develop information on Good Agricultural Practices (GAP) for submission to the Codex.
The ministry of health, on receipt of the above data from the ainistry of agriculture should liaise with the Codex Committee and submit the data in the prescribed format as per the FAO manual for evaluation of pesticide residue data, towards estimation of maximum residue levels in food and feed by FAO.
Collection of different analytical methods for various parameters followed by various importing countries should be done and any discriminatory steps taken by WTO should be opposed through its dispute settlement mechanism.
Mandatory National Standards for spices may be developed for the domestic market, either through strengthening ‘AGMARK’ or ‘PFA’ standards, or separately so that graduation to international standards would become easy.
Upgradation of capacity in terms of human resources and infrastructure even by seeking technical assistance provided under article 9 of the SPS agreement.
Develop accreditation rules for accrediting quality evaluation laboratories both in private and public sectors.
Regular training on analytical methods and use of analytical gadgets for the technical personnel employed both in public as well as private sector labs.

Inept Post-Harvest Handling
Post-harvest operations involve drying, curing and primary packing. This reduces problems of contamination. Scientific post-harvest handling has yet to come to the agricultural operations in the country, especially in spices. Some traditional practices are lost in the course of time and new scientific practices are yet to become operational at the desired levels. This is one of the major reasons for quality problems in spice exports. Our natural comparative advantages in production are being whittled away due to the poor quality of the produce. China is able to supply aflatoxin free chilli (labelled products and bulk packing are solutions identified as reducing contamination, especially of external origin). Use of hygienic drying surfaces, use of mechanical devices (pepper deberrying, turmeric boiling and cleaning, ginger peeling), use of farm level storage, etc., are important interventions. Considering the vast area to be covered, this is a tall order. But quality management at farm level can improve our competitiveness in the international market.

The Spices Board is engaged in areas of training on post harvest practices benefiting farmers, traders and workers in processing, manufacturing and exporting units. Apart from this, the Board is engaged in capacity building in areas of infrastructure development for drying, storage and hygienic handling of spices. A few units have started HACCP practices from the point of receipt of goods at the factory premises.

The policy initiatives required in this area are:

Incorporation of on-farm post-harvest handling as part of the agricultural operations.
Imparting of regular training on post-harvest operations to extension staff, growers and traders.
Mechanised handling of commodities after harvest wherever feasible.
Developing infrastructure at growers’ level and at common facility centres for drying/curing of the products.
Capacity building for storage at on-farm and off-farm levels. This may include setting up of cold chains, warehousing facilities, reefer vans.
Research input on better packaging and storage at farm level.

Value Addition: Currency for the Future
Value addition of spices in the country is practically limited to the production and supply of spice oils and oleoresins, spice powders, spice mixes and blends, curry powder and supply of spices in consumer packs. Spice exports in consumer packs are limited to about 5,000 tonnes per annum. The exports of value added spices are mainly to Middle East and ethnic populations.

Real value addition in spices occurs in developed countries in the form of processing and packing in attractive packages. These consumer packed spices are sold at exorbitant prices (usually four to five times the bulk cost) though in very small quantities. Another form of value addition is development of new products and new uses, which involves heavy investment in research and development. Sterilisation using steam, irradiation using Cobalt-60/ionised electronic beam, supercritical carbon dioxide fluid extraction, dehydration, freeze-drying, cryogrinding, etc., are some of the techniques developed for value addition. Flavourants, colourants, fine chemicals are some of the major products that have wide applications in consumer products like sausages, pharmaceuticals, neutraceuticals, cosmetics, toiletries, etc.

Value addition therefore demands the development of new products and new uses for spices. This requires research and development. The major laboratories engaged in the field are Central Food Technological Research Institute, National Institute of Nutrition, Central Institute of Medicinal and Aromatic Plants, Regional Research Labs of CSIR at Trivandrum, Jammu and Jorhat

As in the case of agriculture, private efforts in the field of research are very limited. With the dawn of the ‘patents’ era, one should initiate the tempo for new product use development. This may require policy initiatives towards:

Entrepreneurship development in value addition of spices leading to exports.
Venture capital funding for research, development and commercialisation of new value added spices.
Facilities for quick registration of patents
Market promotion of new products within and outside the country
Attracting FDIs in area of value addition for new technologies and market support.
Promoting private sector investments in research and development of new products.
Developing better packaging material and innovative packaging designs
Making compulsory the use of ‘Bar Coding’ for all types of spice exports

Market Development - the Ultimate Goal
India exports spices to 120 countries. Her biggest trading partners are the US, Europe and Japan. It is doubtful that India has done any aggressive marketing, except for sporadic attempts in this direction. India still enjoys only the status of a commodity exporter in these markets, except for spice oils and oleoresins. So far Indian entrepreneurs/exporters could not develop any brands of their own in these markets. The processors/packers in these countries and a few multinational companies buy Indian products and sell them under their brands at a price 4 to 5 times more than they cost. Indian brands have yet to find markets beyond middle-class and ethnic populations elsewhere.

India is facing stiff competition from other producing countries that supply spices in whole form. Most of these countries have no domestic market for the spices they are producing, forcing them to sell their produce even at cost price (examples cardamom from Guatemala, pepper from Vietnam, cloves from Indonesia). Apart from quality improvement and value addition, there are a number of approaches enabling the removal of impediments for the day-to-day export business. This includes compliance with stipulations under various WTO agreements for better market access, development of brands for Indian products and their promotion in major markets, development of niche markets for specified products, attracting foreign direct investments, encouraging joint ventures and amalgamations.