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Taliban takeover shakes up Indian dry fruit market, prices surge ahead of festive season

Dry fruits are among Afghanistan's most exported agricultural products. India is the second-biggest destination of its total exports, making up a share of 40.6 per cent.

A dry-fruit vendor in Srinagar | Representational image | ANI
A dry-fruit vendor in Srinagar | Representational image | ANI

New Delhi: The Taliban takeover in Afghanistan has left India’s dry fruit traders reeling with prices shooting up by as much as 30-70 per cent just weeks ahead of the festive season. 

Traders allege that imports from Afghanistan have halted on account of several factors — trade route disruption, issues with paper clearances and the collapse of banking in the country — putting them on a sticky wicket at a time usually marked by bumper sales, and aggravating the hit inflicted by Covid.  

Dry fruits, which are used as a whole food as well as a value addition in delicacies like biryani and sweets, are widely exchanged as gifts, especially during the Dussehra-Diwali season. 

Afghanistan is one of the major suppliers of apricot and fig (khoobani, anjeer) for the Indian markets. Other imports from the country include mamra or gurbandi almonds, small pistachio nuts, walnuts, almonds, pine nuts, and spices like shahi jeera and hing. While India is a net exporter of raisins, it also imports millions of dollars worth of raisins from Afghanistan, including the exotic black variety.    

India’s imports from Afghanistan were valued at more than Rs 3,700 crore in 2020-21, out of which fruits and nuts accounted for more than Rs 2,300 crore, according to the Union Ministry of Commerce trade database. Some estimates suggest up to 85 per cent of India’s dry fruits come from Afghanistan.

Speaking to ThePrint, Ravi Batra, a wholesale dealer and owner of Bhagwati Trading Company at Khari Baoli, the iconic Old Delhi Mughal-era market popular for spices, dry fruits and foodgrains, said “the prices of all the Afghan dry fruit items have increased at least by Rs 300-500/kg”. 

“While almonds are being sold at around Rs 1,100-1,500/kg against Rs 700-800 earlier, anjeer prices have increased to Rs 1,300-1,700/kg from Rs 900-950,” he added.

The prices, traders say, began to rise in mid-August, right around the time that Kabul fell to the insurgent group.

“The Taliban takeover has happened right around the harvest season for dry fruits. The traders in the country are ready with the consignment but due to trade route disruption, paper clearances and banking collapse, everything has come to a halt,” he added.

Raminder Singh, owner of the Amritsari Wadi, Papad and Dry fruit shop at Regent Cinema Chowk in Amritsar, said “with the absence of new stock, suppliers are selling the old stock at higher rates and have even doubled (rates), taking advantage of increased demands of the festival season”. 

“The high prices driven by uncertainty in Afghanistan have also pushed the prices of other dry fruits, which are not mainly supplied from there such as raisins and cashew,” he added.

A senior official from the Directorate General of Foreign Trade (DGFT) under the Union Ministry of Commerce said they are “expecting the situation to stabilise in the next 15-20 days as the terms of trade will be getting more clarity with Afghanistan”. 

“We are one of the largest trade partners of Afghanistan. The ongoing disruption is just a temporary glitch that will be well over before the arrival of the peak festive season of Diwali and Dussehra as trade will resume slowly and steadily,” the official added.

Also Read: From Mazar to Kabul, I saw Afghanistan fall to Taliban in 10 days

‘Heavy losses expected’

According to the World Trade Organisation (WTO) Trade Profiles 2020, agricultural products make up 65.8 per cent of Afghanistan’s exports. Dry fruits are among its most exported agricultural products. India is the second-biggest destination of the country’s exports, making up a share of 40.6 per cent in 2018.

Talking about India’s dry fruit trade with Afghanistan, the DGFT official quoted above said the advantage with importing from the country “is proximity… and also because the goods are imported at concessional tariffs due to a preferential trading arrangement”. 

“The price rise is also due to volatile speculation in business as one of the major import destinations has been cut off, but, in due course of time, the import of dry fruits from other countries will be able to fill the gap, the official added.

Imported goods from Afghanistan normally reach India through the sea route, via Iran’s Chabahar port. Under the land route, the consignments are routed through Pakistan via the integrated check post (ICP) at the Attari border, from where they finally reach Amritsar for further transport across the country. 

Afghanistan is currently grappling with a situation of grave instability in light of the Taliban takeover, which has been completed at an unforeseen pace amid the pullout of international forces who arrived in the nation for the US-led ‘war on terror’. Thousands of Afghans have been fleeing their homeland, haunted by memories of the Taliban’s brutal rule from 1996 to 2001.  

As things stand, traders say the Taliban are not recognising the consignment clearance papers granted by the previous Afghan government, which they cite as one of the factors that have stopped trade.

Ajay Sahai, Director General (DG) of the Federation of Indian Export Organisations (FIEO), the apex body of export promotion councils in India, has been quoted as saying that the Taliban have stopped all imports and exports with India, and halted the movement of cargo through the transit routes of Pakistan. 

“We are keeping an eye on the developments in Afghanistan. Imports from there come through the transit route of Pakistan. At the moment, the Taliban has stopped the movement of cargo to Pakistan, so imports have virtually stopped,” he said. “If the trade doesn’t resume, prices of the existing dry fruit stock will shoot up and traders will have to also look for alternative sources of supply.”

Ravi Batra said traders are “working on procuring cheaper alternatives of some dry fruits from other destinations… to ensure the continuation of trade in peak festive season”, citing as examples walnuts and pine nuts from Kashmir, the US, and the EU. 

“Already, with the increase in prices, people who used to buy dry fruits for consumption and gifting in Rakshabandhan shifted to sweets and chocolates,” he added.

Raminder Singh said “trade may reopen and stabilise in the next coming months with normalcy returning in trade routes but by then festive demand and sales will be over, leading to heavy losses to both consumers and traders”. 

“The Covid lockdown has already damaged business for the last two years,” he added.

(Edited by Sunanda Ranjan)

Also Read: Why India should forget Afghanistan, Pakistan, ‘Terroristan’ & shift strategic gaze to the seas