"In the midst of every crisis lies great opportunity" – Albert Einstein.

When Iran was caught in the middle of a geopolitical crisis and sanctions, India joined forces with the nation to protect their economic interests. This turned out as a real opportunity for Indian banana growers and exporters, and apple producers and exporters of Iran.

Today, Iran is the largest importer of Indian bananas. "Multiple factors are at play here. While initially, the geopolitical crisis made Iran look at India, today the quality and the price point India offers have made Iran opt for bananas produced in India," said Pankaj Khandelwal, chairman and managing director of INI Farms.

Banana Story Of India: Top Export Countries

(Values in Rs Lakh)

In the last nine years, Iran's banana import from India increased from a mere Rs 3 crore in FY14 to Rs 407 crore in FY22. Around 34 percent of bananas exported by India go to Iran. Iran overtook this position from UAE in FY20, till when UAE was the largest importer of Indian bananas.

Mahesh Chaudhari, director at Sagro Banana Producer company, said, "Bananas produced in Jalgaon today are imported to Iran. While for us Dubai continues to be a large market, the demand from Iran for Fresh Cavendish bananas has been growing."

Banana Story Of India, Including Plantains, Fresh Or Dried

He believes as soon as markets like China and Pakistan open up, India will have a huge growth opportunity among its neighbours. "Selling agri-produce to neighbouring countries helps reduce freight cost and cost involved in improving shelf-life of the produce. In the end, all the extra bucks earned go to a farmer. Thus, improving farmers' income."

UZBEKISTAN: BANANA IMPORTS FROM INDIA

Data shows Uzbekistan, which was not among the top 10 export countries for Indian bananas until FY21, is now among the top 10 in FY22. And for Uzbekistan, Indian bananas are not among the top three in the case of the banana trade. This market opened up after Uzbekistan allowed the duty-free import of banana and citrus fruits.

Also Read: Air India CEO says merger with Vistara under process, flying AI will be a different experience from next year

Chaudhari said that while India is still behind in terms of quality with Ecuadorian bananas in a few areas, the farmers and other organisations are working towards further improving the quality but at a low price point. "Today, bananas exported from India do hold a command in the market."

Meanwhile, Pankaj Khandelwal said that with continued efforts, Indian bananas can soon reach European shores.

Some bananas for an apple?

Is it a Catch-22 position for India? On one hand, while India exports bananas worth Rs 407 crore to Iran, it imports apples worth Rs 436 crore to India.

Why this apple-to-banana comparison?

It's not right to compare apples to bananas. But it is difficult not to highlight that the Indian market is flooded with Iranian apples – many claim the fruit has taken different routes to reach Indian shores.

But why so? As per export regulation in Iran, the import of bananas is conditional: traders could obtain a license to register an import order for 1 kg of bananas for the export of every 3 kg of apples.

INDIA: APPLE IMPORTS FROM IRAN

(Values in Rs Lakh)

IRAN: BANANA IMPORTS FROM INDIA

(Values in Rs Lakh)

So, to cater to Iran’s love for bananas, regulatory norms around apples have to be addressed. Iran’s top export market for apples is India and Turkey, among others.

Farmers in Kashmir, Himachal Pradesh, and other apple-producing states in India have on several occasions — mostly for the last three years — raised concerns over Iranian apples. So, it’s like you win some and lose some.

What’s next for India’s banana

Further, traders feel Iran is going to increase its banana imports from India and reduce their imports from the Philippines and Ecuador.

Also Read: KV Kamath on India’s inflation data reliability - ‘are we measuring it right?'

After COVID, the demand for bananas was getting back on track, but inflation and other geopolitical issues hit the market. In the case of Iran, during the widespread protests following the death of Mahsa Amini in police custody, the demand for Indian bananas did see a fall. "There was no clarity in the third quarter of FY23 if there will be demand for the fruit. But over time, it did improve," said Pankaj Khandelwal.

However, he believes, with inflation easing and some stability in pricing, there will be more clarity in terms of demand in the coming next six months.

First Published:Feb 28, 2023 12:16 AM IST