Pepper export subsidy unlikely to resume

The subsidy for black pepper exports offered late last year is not likely to be resumed because the commerce ministry is not in favour of it, it is learnt. The ministry does not favour the scheme since pepper prices have doubled during the past four months, sources said.

The Spices Board had stopped receiving applications for subsidy effective February as the 20,000 tonne target set for exports had already been met.

The board later submitted its recommendations for continuation of the scheme in order to maintain the high price levels of the recent time.

The commerce ministry had announced the scheme "� Rs 5 as ocean subsidy and Rs 2 for domestic transportation "� in October 2005 in the wake of a steep fall in prices. At that time, the ministry also made it clear that the scheme would continue only till March 2007 or till the time a 20,000 tonne export target would be achieved, whichever was earlier.

Ministry sources said as domestic production was expected to fall 15-20 per cent, it was likely to see better price realisation this year. So there was no point in continuing with the subsidy scheme, ministry officials said.

The Spices Board is also not expecting a positive decision from the ministry in favour of the subsidy scheme.

The spot price of IPSTA has increased to Rs 11,900 a quintal for ungarbled and Rs 12,500 for garbled mainly on reports of production shortage.