The fisheries and fish trade of India

Marine Fisheries Review, Spring, 1990

Introduction

India's seafood exports increased both by quantity and value during the country's 1988 fiscal year (April 1988-March 1989). Although India has begun to diversify fish production and marketing, its efforts to move away from shrimp as the predominant marine export, and Japan as the principal overseas market, have been slow. Because India's coastal shrimp resources have been widely overexploited by both commercial trawlers and small-scale, traditional fishing operations, any future growth in shrimp production must result from the expansion and improvement of shrimp culture operations.

Government policies support trawler construction and favor export-oriented seafood enterprises. So far, however, few non-shrimp-oriented fishing operations have been successful. Meanwhile, the country's seafood processing industry, plagued in the past by the high cost of raw materials and weak domestic demand, remains a virtually untapped area for growth with significant potential for servicing both foreign and domestic markets.

Fishery Exports

India's fishery exports grew nearly 3 percent by quantity in 1988, to almost 99,800 metric tons (t)-the fourth consecutive yearly increase. Export value also increased by 13 percent to almost 6 billion rupees ($387 million at a currency exchange of $1 = 15.5 rupees). India's total fishery catch during this period was a record 3.2 million t. The quantity of Indian seafood exports has grown almost sevenfold since 1961. Although some diversification of seafood markets occurred during 1988, the preponderance of exports, primarily frozen shrimp, still go to two countries: Japan and the United States. The quantity of shrimp exports has risen only 4 percent since 1983. Although frozen shrimp still make up the lion's share of India's seafood exports by quantity (59 percent) and value (79 percent), there has been gradual development of other seafood export commodities, including frozen squid (16 and 6 percent by quantity and value, respectively), lobster tails, and a variety of frozen fish.

Fisheries Production

The localized overexploitation of India's coastal shrimp resources by commercial trawlers and an increasing number of small-scale fishermen has led to the stagnation of India's total shrimp production. The increasing scarcity of shrimp has caused physical clashes among fishermen as larger mechanized trawlers encroach on shallow coastal areas reserved for smaller, traditional gillnet fishing boats. In addition, shrimp trawling operations have a significant negative impact on other fish species, leading to an estimated 70,000 t of discarded "trash" fish annually. Saturation of the shrimp fishery led the southern Indian state of Kerala to establish the first ban on all coastal shrimp fishing for July-August 1989. To prevent overfishing the Bay of Bengal off Visakhapatnam, the Ministry of Food Processing instituted a ban on "bull trawling" (sweeping the sea bottom with nets). The ban was lifted in September 1989. In addition, falling world prices for shrimp have caused India's seafood exporters to pass the lower prices on to the small-scale fishermen, creating further hardship and generating hard feelings between large-scale and small-scale producers.

Fishing Fleet

There are currently 157 large ([greater than] 20 m) vessels, almost exclusively trawlers, 200 medium (16-20 m) vessels, and over 2,000 small (10-16 m) mechanized vessels operating in Indian waters. In addition, an estimated 180,000 traditional fishing craft (about 5,000 with outboard motors) ply Indian coastal waters. The Government hopes to add over 300 non-shrimp trawlers (23-28 m) and long-liners under its eighth 5-Year Plan (1990-1995). The stagnation of India's shrimp production, despite the increased number of fishing vessels in operation, has led to serious clashes between the mechanized trawl fleet and traditional gillnet fishing fleet, particularly as the larger vessels move inshore in violation of Government regulations.

Trawler Policy

The Indian Government has decided to permit large domestic industrial enterprises to charter foreign fishing vessels, with a clause stipulating an 80:20 catch share ratio between the foreign and Indian partners, respectively. Indian partners reportedly are opting for the value of the catch, rather than the fish, to avoid marketing difficulties. Although the Government ostensively welcomes the chartering of trawlers, the vessels are prohibited from operating in India's coastal waters. Most foreign charters have found this restriction unacceptable and have withdrawn their trawlers. To encourage Indian ownership of trawlers, the Shipping Credit and Investment Corporation of India, which subsumes programs offered in the past by the Shipping Development Fund Committee and the Trawler Development Support Fund, provides a 33 percent subsidy on the cost of Indian-made hulls and loans at the concessional interest rates for purchasing domestic, as well as foreign-built, trawlers.

Foreign participation in fishing joint ventures is acceptable within the framework of India's "Hundred Percent Export-Oriented Unit" (HEOU) program, which provides a favorable regulatory environment for export industries. For deep-sea fishing, foreign ownership in an HEOU joint venture is restricted to 40 percent; up to 15 percent of the catch of an HEOU venture can be sold domestically. Although no age restriction on fishing vessels exists under Government chartering regulations, current Government joint-venture regulations prohibit ships older than 8 years from being brought into India.