The coffee business will get an impetus from the reduction in basic customs duty from 7.5% to 5% on specified coffee plantation and processing machinery. Some say it could even encourage home-brewing of coffee.
Coffee growers, brewers, grinders, roasters, processors, curers and retailers will now be able to import machinery and equipment at a lower cost. It will allow more farmers to import farming equipment like weed cutters, berry pluckers, grading and cleaning machines, sprayers and other plantation machinery. Coffee retailers may be able to import coffee dispensers, vending machines, blenders, shakers etc at a lower cost.
Anil Bhandari, president of the India Coffee Trust, said most of these equipment are imported now and therefore the cut in import duty will give a boost to the coffee landscape in general.
Marvin Rodrigues, chairman of Karnataka Planters’ Association, said the reduction in import duty would complement Coffee Board’s mechanization scheme. “The board has been pushing for mechanization, taking cognizance of the acute labour shortage and wide-spread labour migration in the plantation industry. The only way to survive is to introduce mechanization,” he said.
Bose Mandanna, member of the Coffee Board and a large coffee planter from Coorg, said any reduction in import duty would benefit the entire coffee eco-system, be it growers, roasters, curers or retailers.
The coffee culture in India is becoming stronger. The country’s per capita coffee consumption now is 100 grams, up from just 60 grams three years ago. In England it is 9 kilograms, and in the US 5.5 kg.
“Coffee consumption is growing at 40% per annum in northern states, where it has not been the traditional beverage. The favorable duty structure will also help kick start a home-brewing culture. If coffee brewing machines are available in the Rs 5,000 to Rs 8,000 range, many households will be interested in them. Currently they are well over Rs 10,000,” said Bhandari.
source: http://www.articles.timesofindia.indiatimes.com / Business> Budget 2012> Union Budget / TNN / March 17th, 2012
