The decision by the Ministry of Industry and Food Processing to give preference to a few companies, including ITC, under the PLI seafood program in fiscal year 2019-2020 has upset some leading and genuine seafood exporters, which were not included.
A seasoned exporter in the industry, who did not wish to be identified, said Activity area that the entry criteria for a minimum turnover of 600 crore for the PLI program was unfair, as many fellowship members were just below that figure for the qualifying year. But these companies meet the other criteria such as minimum investment and CAGR for inclusion in the PLI scheme.
He alleged that the ITC qualified after including all of its food product sales to qualify for the seafood LIP. If only seafood exports had been taken, the company would not have qualified because its seafood exports were far lower than those of more than 50 family exporters, he said.
According to him, the criteria set by the ministry prevented many large seafood processors from applying to the PLI program. Due to entry eligibility criteria, many were unable to apply in FY 2019-2020 as their turnover was less than 600 crore.
It is also pointed out that the Seafood Exporters Association had even met senior officials of the ministry in July seeking relaxation. Still, the authorities expressed their inability to change the eligibility criteria, citing the Cabinet decision.
The exporter also pointed out that changing the criteria to a single investment was not sufficiently and correctly informed about the seafood trade. For this reason, some large exporters who are in the process of setting up new seafood factories. Seafood products could not claim to be included in the program, even if they exceed the minimum investment criteria and the CAGR. These companies could not even apply online as the 600 crore entry barrier prevents them from accepting their applications.
No response from MPEDA
An email requesting comment from the Marine Products Exports Development Authority did not elicit a response until this report was released.
When contacted, Alex K. Ninan, President of the India-Kerala Region Seafood Exporters Association, said that no state player would be eligible to be included in the PLI program. in the current form as they would fall below the baseline of 600. turnover crore. Out of the country’s 42,000 crore seafood exports, Kerala’s seafood exports contribution was 5,000 crore.
The program is not beneficial to most players in the seafood industry, and it will give cash-rich multinationals and exporters an advantage. Most of the country’s exporters are medium and small-sized companies and fall below the benchmark of 600 crore in turnover. To promote exports, he suggested a level playing field for all rather than focusing on very few with an uneven distribution of incentives.