New Delhi: A mix of global disruptions and concerns over goods and services tax (GST) is driving up the cost of dry fruits in India, leading to a sharp drop in sales just as the festive season approaches.
Importers said they are holding back new shipments amid uncertainty over US tariff decisions and a possible hike in GST on dry fruits.
The supply crunch has caused sales to fall as much as 25% compared with this time last year, at a time when demand typically peaks as preparation for the festive season starts.
"Global supply chains are already strained due to the crisis in West Asia, and now tariff questions are compounding the issue," said Nitin Sehgal, chief executive of the Nuts and Dry Fruits Council (India). "There's also apprehension that dry fruits could be moved into the 18% GST slab when the tax review takes place," he added.
At present a 12% GST is applicable to nuts and dried fruits. The industry fears that under the proposed system when the 12% slab is likely to be eliminated, it could fall under the 18% bracket, increasing the cost for consumers.
Dry fruit importers are delaying customs clearance of walnuts, almonds and other nuts from the US as they fear a steep reduction in import duty after the proposed India-US trade agreement. In such a scenario, they could face losses if they import now paying the current duty.
The industry is expecting a reduction in duty on walnuts and almonds, said Ravindra Mehta, founding member at the Nuts and Dry Fruits Council.
Prices of popular nuts such as almonds and walnuts have surged, with walnuts jumping from '400 to '700 per kilogram in recent weeks. Almonds have risen to '700 from '600, while pistachios have become scarce.
More than 60% of the consumption for the '60,000 crore nuts and dry fruit industry happens during the festive season, which starts with Raksha Bandhan.
The season peaks during Diwali and continues till Christmas.
This year the festive season starts early, with Raksha Bandhan, Teej and Janmashtmthi, followed by Ganesh Chaturthi in July and August.
The dry fruit market is already experiencing supply constraints due to the suspension of Afghan imports as the Wagah Border has been closed after Operation Sindoor.
Importers said they are holding back new shipments amid uncertainty over US tariff decisions and a possible hike in GST on dry fruits.
The supply crunch has caused sales to fall as much as 25% compared with this time last year, at a time when demand typically peaks as preparation for the festive season starts.
"Global supply chains are already strained due to the crisis in West Asia, and now tariff questions are compounding the issue," said Nitin Sehgal, chief executive of the Nuts and Dry Fruits Council (India). "There's also apprehension that dry fruits could be moved into the 18% GST slab when the tax review takes place," he added.
At present a 12% GST is applicable to nuts and dried fruits. The industry fears that under the proposed system when the 12% slab is likely to be eliminated, it could fall under the 18% bracket, increasing the cost for consumers.
Dry fruit importers are delaying customs clearance of walnuts, almonds and other nuts from the US as they fear a steep reduction in import duty after the proposed India-US trade agreement. In such a scenario, they could face losses if they import now paying the current duty.
The industry is expecting a reduction in duty on walnuts and almonds, said Ravindra Mehta, founding member at the Nuts and Dry Fruits Council.
Prices of popular nuts such as almonds and walnuts have surged, with walnuts jumping from '400 to '700 per kilogram in recent weeks. Almonds have risen to '700 from '600, while pistachios have become scarce.
More than 60% of the consumption for the '60,000 crore nuts and dry fruit industry happens during the festive season, which starts with Raksha Bandhan.
The season peaks during Diwali and continues till Christmas.
This year the festive season starts early, with Raksha Bandhan, Teej and Janmashtmthi, followed by Ganesh Chaturthi in July and August.
The dry fruit market is already experiencing supply constraints due to the suspension of Afghan imports as the Wagah Border has been closed after Operation Sindoor.
