India announces freight subsidy for dairy exports

A wider variety of dairy products from India will soon be available to consumers in regions including the Gulf, thanks to a Directorate General of Foreign Trade (DGFT) scheme intended to extend air freight assistance to exporters.

“Dairy products, which were hitherto not covered under the scheme, will be eligible for assistance under the revised assistance program,” the Indian government announced.

“The DGFT will shortly notify the procedure for availing of assistance under the revised scheme.”

It added “specified agricultural products” from India, exported to markets in the Gulf, will get enhanced financial support by way of a freight assistance. Such products, which were already receiving some export assistance, will now get 50% more freight support if the exports are from India by sea.

However, if the agricultural exports are by air, they will be eligible for 100% freight subsidy. The 100% freight subsidy will be useful for perishable dairy products that need to be shipped by air.

The one-year scheme was originally announced in February 2019 to help exporters offset rising freight costs. It
was later extended by a year until the end of March, 2021.

The Revised Transport and Marketing Assistance for Specfied Agriculture Products Scheme with enhanced rates will now be in operation until the end of March, 2022. Indian exporters estimate their shipping costs have increased by 300% over the past year, partly due to disruptions caused by Covid-19.

Enhanced assistance under the revised scheme is expected to help Indian exporters of agricultural and dairy products to meet rising freight and logistics costs,” the Indian government said.