India shrimp exports to US seen up on duty removal

India's shrimp exports to the US are seen to increase after the World Trade Organization has ordered Washington to withdraw a duty it imposed on such exports in 2004.

US' imports of Indian shrimp, which stood at Rs 1,900 crore in 2002-03, started to plummet January 2004, when the US initiated its anti-dumping investigations on the product.

An Indian commerce official said the "US lost the case at the WTO and had to remove the Customs bond as it was found illegal". The WTO verdict will help shore up India's marine exports which already fell 50 percent over the last four years due to the discriminatory action of the US Customs, he added.

Industry players estimate that shrimp exports in 2008-09 are expected to reach Rs 611 crore, which is less than a third of the value of exports six years ago. However, the Seafood Exporters' Association of India expects shrimp exports to cross Rs 1,000 crore in 2009-10.

However, pundits claim the Indian victory in fact, short-lived since the WTO quashed the country's claim that the anti-dumping agreement of the organisation did not allow additional financial imposition. This may lead to the US imposing additional duties on Indian shrimps, another official said.

India will observe the situation at attempts of the US Customs department to replace the bond by other forms of duties on shrimps. The US had recently reduced anti-dumping duty on Indian shrimps to 0.79 percent last month from 1.69 percent -- a fraction of the initial peak of 10 percent.

According to reports in the US media, the US Southern Shrimp Alliance has asked the country's Customs department to implement new measures to collect duties on "unfairly-traded" shrimp imports as soon as possible.