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Port Inefficiencies and India's Agri-Export Competitiveness

18 Nov 2025 GS 3 Economy
Port Inefficiencies and India's Agri-Export Competitiveness Click to view full image

India’s Agri-Exports: Current Landscape

  • India exports a wide basket: fruits, vegetables, spices, cereals, processed foods, meat, marine products.

  • Key destinations: Asia, Europe, West Asia, North America.

  • Logistics pattern:

    • 80%+ agri-exports move through ports.

    • Only 10–20% go as air cargo.

Core Issue: Port-Related Inefficiencies

These inefficiencies act as a “hidden export tax” and hurt farmers, processors and allied sectors.

1. Cargo Contamination

  • Outdated handling practices.

  • Inadequate fumigation.

  • Weak quality control.

  • Result: Damages India's reputation in quality-sensitive markets.

2. Delays & Lack of Agri-Focused Infrastructure

  • Prolonged berthing delays.

  • No dedicated agri-berths.

  • Spoilage risk for perishables, especially horticultural produce.

3. Warehousing Deficit

  • Storage often located 15+ km away from ports → higher first-mile costs.

  • Inadequate cold-chain facilities.

  • High warehouse rentals, uncompetitive for agri-exporters.

4. Higher Port Handling Charges

  • Example: Visakhapatnam charges higher than Kakinada and Gangavaram.

  • Shortage of labour and surveyors causes operational delays, demurrage.

Untapped Advantage of Indian Ports

  • Ports like Visakhapatnam and JSW have geographical proximity to major agricultural belts:

    • Andhra Pradesh

    • Maharashtra

    • Karnataka

    • Tamil Nadu

  • These regions produce rice, banana, onion, spices, grapes, mango, marine products, processed foods.

  • India’s import needs like raw cashew, pulses, edible oils, cocoa, natural rubber also demand efficient two-way handling.

Need for Modernisation

To support India’s $5 trillion economy goal, ports must become:

  • Efficient

  • Technology-enabled

  • Future-ready

  • Integrated with hinterland connectivity

Reform Agenda: Transforming Ports into Global Agri-Trade Gateways

1. Infrastructure Modernisation

  • Pre-cooling units.

  • Irradiation facilities.

  • Hot-water treatment plants.

  • Temperature-controlled storage.

  • Impact: Reduces post-harvest losses by 30–40%.

2. Strengthening Cold-Chain Networks

  • Encourages smooth handling of perishables.

  • Reduces spoilage and delays.

3. Leveraging Government Schemes

  • APEDA infrastructure grants.

  • National Horticulture Board support.

  • PM Kisan Sampada Yojana for processing and storage infrastructure.

4. Single-Window Operations within Ports

Agencies that must operate within the port premises:

  • Plant Quarantine

  • FSSAI

  • National Plant Protection Organisation (NPPO)

  • Customs

This reduces procedural delays and improves export efficiency.

Prelims Practice MCQs

Q. Consider the following statements regarding India’s agricultural exports:

  1. More than 80% of India’s agricultural exports move through seaports.

  2. Fruits and vegetables constitute the largest share of India’s air-cargo-based agricultural exports.

  3. India exports agricultural products mainly to Europe, Latin America and Oceania.

Which of the statements given above is/are correct?
A. 1 only
B. 1 and 2 only
C. 2 and 3 only
D. 1, 2 and 3

Correct Answer: B
Explanation:

  • Statement 1 is correct: 80%+ of agri-exports use ports.

  • Statement 2 is correct: Perishables like fruits, vegetables often dominate air cargo.

  • Statement 3 is incorrect: Major markets are Asia, Europe, West Asia, North America.

Q. The phrase “hidden export tax” in the context of India’s agri-export sector refers to:

A. High GST rates on agricultural commodities
B. Losses and costs due to port-related inefficiencies
C. Mandatory certification fees for export
D. International tariffs imposed on Indian exports

Correct Answer: B
Explanation:
The text describes inefficiencies such as delays, spoilage, contamination, and high handling charges as a hidden export tax because they indirectly increase export costs.



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