Caricom Market and Indian Spice Trade Imm Project

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Caricom market and Indian spice trade - IMM Project
Executive Post Graduate Diploman in Internatinal Business (Indian Institute of Foreign

Trade)
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Indian Institute Of Foreign Trade, Delhi International Marketing Management (MKT 03)
Economic potential of CARICOM common market and

prospect of Indian spice trade
In 1973, the smaller, largely English-speaking countries of the Eastern Caribbean launched the Caribbean
Community and Common Market (CARICOM), an integration plan intended to coordinate and enhance
their collective economic and social development. Initially designed as an intraregional free trade area
with expectations that it would become a common market. CARICOM integration has unfolded slowly and
been limited to a partial customs union. CARICOM's strategy for finally achieving a "single economic
space" rests on implementing the Caribbean Single Market and Economy (CSME). CARICOM is a highly
trade dependent region undergoing major changes to its economic relationship with the world.
India is one of the top most spices exporting countries in the world. India is favored with a perfect agro-
climatic zone, spices of trade to 120 nations. Spice exports from India experience high growth rate along
with significant instability. The results of the revealed symmetric comparative advantage indicate that
India is having unique comparative advantage in exports of turmeric, cardamom and seed spices. The
spice board of India pays a way for the fare advancement of Indian spices by promoting and developing it
worldwide. A study on prospect of Indian spice trade to CARICOM market is an attempt to evaluate the
factors influencing the export and benefits of spices trade to Caribbean countries
Submitted by:
Sahil Jain [25A]
Suman Mondal [27A]
Kumar Sachin [19A]
Md. Faiz [32A]

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Table of content
1. Executive Summery 3
2. CARICOM: Background and Development 4
3. History of Economic Integration 5
4. Challenges to Integration 6
5. CARICOM: Trade with the World 7
6. CARICOM Countries and their economic potential 8
7. CARICOM single market countries 8
8. CARICOM members average GDP 8
9. CARICOM members average HDI 8
10. Natural resources 9
11. Unemployment rate 9
12. Labor force and globalization 9
13. CARICOM single market and economy 10
14. Analysis of Spice production of India market 10
15. Data Analysis 11
16. Summary of India spice production and demand 16
17. India’s trade and investment relation with CARICOM market 17
18. Prospect of spice trade from India to CARICOM 18
19. Appendix 20

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Executive Summery
Caribbean Community (CARICOM) is one of the major trade blocs in the Latin America and Caribbean
region. CARICOM was established in 1973 amongst Caribbean countries, viz. Antigua and Barbuda,
Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, Montserrat, St. Kitts and Nevis, St. Lucia, St.
Vincent and the Grenadines, and Trinidad and Tobago. The Bahamas, Haiti and Suriname joined the
CARICOM subsequently. Since the objective of CARICOM is to form a common market, most intra-
regional trade has been liberalized.
The establishment of the Caribbean Community (CARICOM) was the result of a 15-year effort for regional
integration which started with the establishment of the British West Indies Federation in 1958. The
community was to provide dynamic leadership and service, in partnership with community institutions and
Groups, toward the attainment of a viable, internationally competitive and sustainable community, with
improved quality of life for all.
A free trade area (CARIFTA) was established in 1968 and replaced in 1973 by a further reaching agreement
of regional integration, the Caribbean Community (CARICOM). The member countries of CARICOM are
also taking steps in the direction of a common labor market. They have gone as far as to allow the free
movement of professionals. CARICOM is considering further liberalization of inner-area migration with
a view to accomplish a fully integrated labor market. This is considered as a crucial ingredient for a
Common Single Market and Economy.
Total trade of CARICOM has witnessed a healthy growth in recent years. Rise in both exports and imports
of CARICOM countries have underlined the increase in total trade of the region. CARICOM’s total trade
has more than doubled from US$ 35.96 billion in 2004 to US$ 78.34 billion in 2008, before decreasing to
US$ 57.07 billion in 2009, due the impact of the global economic crisis,
Developing countries are the dominant source of supply for the world’s US$2 billion trade in bulk (whole)
spices and value-added spice ingredients and products. World trade in spices has long been characterized
by volatility, stemming from the structure of the trade, climatic conditions, and the rapidity with which
producers can respond to price changes.
India is the world’s largest producer and consumer of spices and for a very long time has been among the
leading spice exporting countries. Upwards of three million Indian smallholder households produce spices
and hundreds of thousands of others are involved in spice processing, distribution and trade. India is unique
among the world’s major spice exporting countries in that the bulk of its spice production is used in the
domestic market. While the value of Indian spice exports has been $300-400 million in recent years, the
estimated domestic retail value of spices in India is around $4 billion. Over an extended period, the Indian
spice trade earned a reputation for product quality and marketing service. Recent regulatory changes in
selected destination markets, together with evolving requirements among major commercial buyers have
triggered a variety of responses by Indian producers and processor/exporters and by the Spices Board and
other governmental agencies.
Challenges remain, however, at the commercial level, India has been encountering intensified competition
in the world market for bulk spices. Its ability to compete—on a cost basis—is constrained by the relative
dynamism of its own domestic market. India’s spice exports over the past 40 years, over which time export
volumes have increased some 5-fold while export values have increased 10-fold. India’s spice export
volumes first surpassed 100,000 tons in the late 1970s, and 200,000 tons by the mid- 1990s. The trade
value first exceeded $200 million in the mid-1980s and later exceeded $400 million in 1997–98 through
2000–01.

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CARICOM: Background and Development

Caribbean Community (CARICOM) is one of the major trade blocs in the Latin America and Caribbean
region. CARICOM was established in 1973 amongst Caribbean countries, viz. Antigua and Barbuda,
Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, Montserrat, St. Kitts and Nevis, St. Lucia, St.
Vincent and the Grenadines, and Trinidad and Tobago. The Bahamas, Haiti and Suriname joined the
CARICOM subsequently. Since the objective of CARICOM is to form a common market, most intra-
regional trade has been liberalized. Due to small size of their economies and lack of diversified range of
domestic resources, the CARICOM members are highly dependent on trade. They rely heavily on imports
to support local production and satisfy consumer demand, and given the absence of a sizeable domestic
market, they also rely heavily on export revenues to sustain economic growth. Economic openness
(evidenced by high trade GDP ratios) renders CARICOM economies vulnerable to external shocks such
as fluctuations in international commodity prices or policy changes abroad. At the same time, most
CARICOM countries depend for their export earnings on a very limited number of products.
Economic integration among the countries in the Caribbean region has a long history. A free trade area
(CARIFTA) was established in 1968 and replaced in 1973 by a further reaching agreement of regional
integration, the Caribbean Community (CARICOM). The member countries of CARICOM are also taking
steps in the direction of a common labor market. They have gone as far as to allow the free movement of
professionals. CARICOM is considering further liberalization of inner-area migration with a view to
accomplish a fully integrated labor market which is considered as a crucial ingredient for a Common Single
Market and Economy (CSME). March 2002 CARICOM member states agreed to remove existing
restrictions for inner-community economic activities, including the removal of restrictions to free
movement. The categories of persons who have the right to move freely within the CARICOM area were
extended to include self-employed service providers and entrepreneurs together with their managerial,
technical and supervisory staff and spouses and immediately dependent family members. By March 2002,
there should therefore be no restrictions on the Right of Establishment, the provision of services and the
movement of capital within the community other than those included in the Programs.
In 1973, the smaller, largely English-speaking countries of the Eastern Caribbean launched the Caribbean
Community and Common Market (CARICOM), an integration plan intended to coordinate and enhance
their collective economic and social development. Initially designed as an intraregional free trade area with
expectations that it would become a common market, CARICOM integration has unfolded slowly and been
limited to a partial customs union. CARICOM's strategy for finally achieving a "single economic space"
rests on implementing the Caribbean Single Market and Economy (CSME), formally established in
January, 2006 and intended to be fully in place by 2015. CARICOM is a highly trade dependent region
undergoing major changes to its economic relationship with the world. Adjusting to these changes through
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the CSME is its primary development challenge. To fulfill the CSME vision, its members would have to
adopt considerably deeper commitments to economic integration.
The Caribbean Basin has been a longstanding interest of the United States, and the success of CARICOM
directly affects stability in the region. It therefore has important implications for U.S. trade, investment,
immigration, drug interdiction, and national security policies. Although small in size, CARICOM's trade
and investment relationship with the United States may be poised to become a more prominent issue as the
region adjusts to the changing external environment, not the least of which includes the ongoing erosion
of trade preferences with Europe and the United States, as well as the concomitant rise of bilateral and
regional free trade agreements in the region. CARICOM comprises a group of 12 island and 3 larger coastal
nations in and around the Caribbean Sea, bordered by the Atlantic Ocean to the east, South and Central
America to the south, the Gulf of Mexico to the west, and the United States to the north. Although
CARICOM members share many cultural and historical similarities. Their population, land size,
economies, per capita income, and social indicators (e.g., life expectancy) can vary considerably, a reality
that CARICOM responded to by designating some of its members as less developed countries (LDCs),
making them eligible for "special and differential treatment."
History of Economic Integration

CARICOM was established on July 5, 1973 with the signing of the Treaty of Chaguaramas. It was built on
the trials and errors of previous unification efforts, beginning with the ambitious West Indies Federation
(1958-62), which sought political and economic unification. Despite encouragement by Great Britain, it
dissolved rapidly when Jamaica and Trinidad and Tobago withdrew in favor of national self-determination.
In the midst of the failure to federate, the hope, if not the necessity, of economic integration remained alive
and took new form in 1965 with the Caribbean Free Trade Association (CARIFTA). It marked the
beginning of a free trade area and was replaced five years later by a deeper commitment under CARICOM.
CARICOM began as two linked concepts: the Caribbean Community and the Common Market. Although
conceptually yoked, they were devised as separate legal and institutional entities that provided a needed
flexibility to accommodate differing national preferences for regional integration. The Caribbean
Community comprises multiple functional relationships and institutions designed to integrate the region
politically, economically, and legally. CARICOM was not given supranational authority, however,
dropping any pretense of another federalist experiment, which allowed for relative ease of ratification. This
arrangement, however, did not lead to full regional integration. In the words of two Caribbean experts,
CARICOM is a structure created by national governments to make national policies more effective by
pursuing them within a regional framework.
The Common Market, on the other hand, focused on trade and investment integration and was a stretch
from the start. It proceeded from a free trade area to become a limited customs union, complete with a
porous (multiple exceptions) common external tariff (CET). Although the "Common Market" did not
evolve much beyond a "loose trading regime," CARICOM did succeed in bringing together a diverse group
of states. The smallest islands subsequently formed the Organization of Eastern Caribbean States (OECS)
in 1981 to pursue an even deeper and, some would argue, more successful integration pact in part to
strengthen their position vis-à-vis the larger CARICOM countries.
In 2001, CARICOM formally adopted the CSME concept in the Revised Treaty of Chaguaramas (the
Revised Treaty), effectively replacing the Common Market as the economic integration standard. Together,
CARICOM and the CSME share the attainment of three fundamental goals: 1) economic integration; 2)
coordination of foreign policies; and 3) functional cooperation (banding together to share resources in
health, education, environment, science, technology, transportation, and other disciplines). In each case,
overcoming the disadvantages of small scale has been a driving concern, whether seeking scale economies
from an enlarged domestic market, greater intraregional trade, shared costs in the provision of public sector
goods, or integration of policy responses to negotiate from a stronger unified position in the international
arena. Some of these goals, however, have found greater success than others, as CARICOM struggled to
maintain its momentum.
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Challenges to Integration
From the start, CARICOM faced a harsh external environment. The 1970s was a time of oil price shocks,
rising interest rates, and growing ideological extremism in the Caribbean that gave way to slow growth,
rising debt, social unrest, and political division in the 1980s, although to a lesser extent than in Latin
America. The excesses of this period discouraged deeper integration. CARICOM remained tied to Europe
through unilateral preferential trade arrangements and would take up, with some controversy, the
conditional U.S. offer of unilateral trade preferences defined in the 1983 Caribbean Basin Initiative (CBI).
These preferences enhanced selected trade opportunities, but were ultimately limited and proved to be poor
foundations for diversifying economic activity, as had trade dependence in the colonial period.
By the 1990s, the economies of Latin America and the Caribbean rebounded, but CARICOM actually
began to experience declining growth in output and productivity in many cases, with collective GDP
growth on average falling from 3.9% in the 1970s to 2.2% in the 1980s and 1.9% in the 1990s. In addition,
by the turn of the 21st century, the World Trade Organization (WTO) pressed the European Union (EU) to
eliminate their unilateral preferences accorded CARICOM exports (e.g., bananas and sugar), and the
United States entered into a string of bilateral free trade agreements (FTAs) with Western Hemisphere
countries that began to erode the relative benefits of the CBI preference programs. As the benefits of trade
preferences continued their relative decline, the natural structure of CARICOM's trade patterns began to
shift, as did incentives to move beyond a customs union.
As an inward looking strategy typical of 1970s integration efforts, CARICOM was constrained as a trade-
related development strategy. Described by one Caribbean scholar as, "integrating, expanding, and
protecting the regional market for goods," CARICOM did not enhance intraregional trade to the degree
expected. One study finds that from 1970 to 2003, although intraregional trade grew faster than extra
regional trade, as a percentage of total trade, it peaked in 1998 (details are discussed in next section).
Intraregional trade is also dominated by Trinidad and Tobago's oil exports. Net of oil, which is not affected
much by CARICOM's preferences, intraregional exports have never exceeded 6% of total CARICOM
trade. The trends suggest that CARICOM trade policies were limited in advancing intraregional integration.
Many have cited the lack of progress in implementing CARICOM policies as one factor that has inhibited
intraregional trade growth. Structural factors, particularly the similarity in economies and high
concentration of export products, however, also naturally limited the potential trade effects of CARICOM's
regional market for goods, an effort recently characterized as doomed to be a low impact activity. Future
growth in trade, therefore, is expected to come from exchange outside of CARICOM, which will require
careful management of small-state volatility given CARICOM's highly concentrated export base, which
increases vulnerability to external shocks and erratic shifts in terms of trade.
It is also important to take note of the asymmetries in trade performance among countries, with Trinidad
and Tobago and Barbados having the largest growth in exports, and smaller countries, many with
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diminished agricultural output and increased tourism, experiencing much smaller merchandise export
growth. Jamaica has experienced a marked decline in its exports, while becoming the largest intra-
CARICOM importer of goods, a trend largely attributed to its macroeconomic instability that, in particular,
has hurt the manufacturing sector.
Although CARICOM did not induce a large real growth in intraregional trade, it succeeded in other ways.
There have been significant gains to integration outside the trade area, including the benefits of shared
institutional responsibilities in the provision of public goods and services. In addition, complementary
structures of production have been important for efficiency gains, as well as early efforts to integrate labor
and capital markets, which promote efficient allocation of factors of production, cost reduction, and
improved competitiveness. These non-trade gains are at the heart of the CSME, and provide a major
rationale for moving beyond the limited customs union approach that CARICOM has embraced for three
decades.
The OECS also offers valuable lessons. Macroeconomic stability, for example, has contributed to
comparatively higher growth in output and income levels of these smaller states. The fiscal and monetary
discipline imposed by the monetary union is largely credited with maintaining macroeconomic policy
discipline and points to one advantage of deeper economic integration. By contrast, the worse economic
performance of the much larger states of Guyana and Jamaica is associated with considerable political and
economic volatility and weak macroeconomic policies.
CARICOM: Trade with the World
The CARICOM countries inherited narrow production structures from their colonial economic heritage.
As captive producers and consumers for the European states, Caribbean economies were developed to
complement their counterparts across the Atlantic Ocean. Spawned by foreign investment and sustained
by protected trade, plantation economies arose based largely on sugar and banana production. Minerals
extraction and tourism came along much later. The colonies were equally dependent on European imports
for manufactured goods and food, a relationship that endured for centuries and carried forward into the
post-independence period. As a result, the Caribbean trade regime remained relatively undiversified,
sheltered from competition, and poorly linked to domestic food and manufacturing production that could
have promoted broader-based development.
The Caribbean economies, therefore, were poorly positioned to make the leap to global competition. As
trade preferences eroded, the Caribbean's high production costs and tariff rates exposed its lack of
competitiveness. The encroaching global economy, however, began to force change on CARICOM's trade
and investment relationships, irrespective of the region's capacity or willingness to adapt. The most
significant adjustment to the trade regime has been the declining importance of trade preferences with the
EU and the United States. Unilateral preferences with the EU are being replaced by a reciprocal Economic
Partnership Agreement (EPA), while the relative benefit of unilateral trade preferences with the United
States continues to erode as multilateral liberalization and U.S. reciprocal trade agreements, beginning with
the North American Free Trade Agreement (NAFTA) in 1994, expand. At the same time, intraregional
CARICOM trade shows little promise for growth and Latin America and Asia are emerging as increasingly
important trade partners in the future.
The implications of these trends for CARICOM are still unfolding, but at the least suggest that for many
countries, particularly the smaller ones, manufacturing and agricultural exports may continue to decline
relative to services trade (tourism, financial, education). These alternatives to traditional production and
trade patterns, however, are not developing fast enough to mitigate fully income, employment, and outward
migration problems. Economic transition will be the greatest challenge for the CSME, and perhaps defines
its reason for being.

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CARICOM Countries and their economic potential
The Caribbean Community (CARICOM or CC) is an organization of fifteen states and dependencies
throughout the Caribbean having primary objectives to promote economic integration and cooperation
among its members, to ensure that the benefits of integration are equitably shared, and to coordinate foreign
policy. Its major activities involve coordinating economic policies and development planning; devising
and instituting special projects for the less-developed countries within its jurisdiction; operating as a
regional single market for many of its members and handling regional trade disputes.
CARICOM was established by the English-speaking parts of the Caribbean, and currently includes all the
independent Anglophone island countries plus Belize, Guyana and Montserrat, as well as all other British
Caribbean territories and Bermuda as associate members. English was its sole working language into the
1990s. The organization has become multilingual with the addition of Dutch-speaking Suriname in 1995
and the French- and Haitian Creole-speaking Haiti in 2002. In 2001, the heads of government signed a
revised Treaty of Chaguaramas that cleared the way to transform the idea of a common market CARICOM
into a Caribbean (CARICOM) Single Market and Economy. Part of the revised treaty establishes and
implements the Caribbean Court of Justice.
CARICOM single market countries
Name Join date

Antigua and Barbuda 4-Jul-74
Bahamas 4-Jul-83
Barbados 1-Aug-73
Belize 1-May-74
Dominica 1-May-74
Grenada 1-May-74
Guyana 1-Aug-73
Haiti 2-Jul-02
Jamaica 1-Aug-73
Montserrat 1-May-74
Saint Kitts and Nevis 26-Jul-74
Saint Lucia 1-May-74
Saint Vincent and the Grenadines 1-May-74
Suriname 4-Jul-95
Trinidad and Tobago 1-Aug-73
CARICOM members average GDP [2020 estimate]
GDP is an aggregate measure of production equal to the sum of the gross values added of all resident and
institutional units engaged in production and services (plus any taxes, and minus any subsidies, on products
not included in the value of their outputs). GDP measures the monetary value of final goods and services—
that are bought by the final user—produced in a country in a given period of time. CARICOM countries
have following GDP which is considered to be good and healthy economy for trade.
• Total - $145.3 billion
• Per capita - $18,289
CARICOM members average HDI [2018 estimate]
The Human Development Index (HDI) is a statistic composite index of life expectancy, education (mean
years of schooling completed and expected years of schooling upon entering the education system), and
per capita income indicators, which are used to rank countries into four tiers of human development. A
country scores a higher HDI when the lifespan is higher, the education level is higher, and the gross national
income GNI (PPP) per capita is higher.

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CARICOM countries has average HDI as 0.730 which is considered to be High. This reflects good
lifestyle and moderate per capita income of citizens.
Natural resources
By international standards, minerals most valuable on the international market are found in Cuba, Jamaica,
and Trinidad and Tobago. Several nations of the Caribbean are rich in natural resources; including
Trinidad's vast natural gas and oil reserves, Jamaican bauxite and most recently the discovery of a large oil
field in Guyana. The resources that make significant contributions to domestic economies and regional job
sectors include fisheries, agriculture, forestry, mining and oil and gas bauxite, iron, nickel, petroleum and
timber, among others. Caribbean’s most important resource is its tropical island setting, which has
generated an important tourism sector. The attention by regional governments towards economic
diversification in the early 1990s is often associated with increased production in tourism, oil, and nickel,
spurred by foreign investment in these primary industries.
Unemployment rate
The average unemployment rate of CARICOM participating countries are below 16%. Employment data
show that in the lower developed member states, agriculture plays the most important role with
shares on total employment reaching more than 60% (in Haiti) and about 20 to 25% (in Belize,
Dominica, Guyana, Jamaica, Santa Lucia, St. Vincent and the Grenadines). In other CARICOM countries
the service sector accounts for the largest share of employment with about 80% of total employment in the
Bahamas.
Country Unemployment rate (%)

Antigua and Barbuda 11
Bahamas, The 10
Barbados 10
Belize 9
Dominica 23
Grenada 24
Haiti 41
Jamaica 8
Saint Kitts and Nevis 5
Saint Lucia 20
Saint Vincent 19
Trinidad and Tobago 5
Labor force and globalization
In 2010 the labor force participation rate in the Caribbean was 77% and in 2011 it was recorded that GDP
per capita in the Caribbean communities average near $10,000. Due to the lack of economic opportunity
and low GDP per capita levels, Caribbean people are travelling in large numbers to developed countries.
Globally, Grenada has the third highest percentage of emigrate at 67.3%, St. Kitts and Nevis is fourth at
61.0% and Guyana is fifth at 56.8%. Most of these Caribbean emigrants are women.
Historically, the Caribbean’s banana industry has been the one of the biggest exports; however, agriculture
is beginning to decline in the world economy. Now, it is the exportation of labor that is on the rise in the
Caribbean. Caribbean women are migrating to developed countries for the opportunity to study particularly
in nursing programs. Women in the Caribbean migrate in large numbers to developed countries such as the
United States, Canada, the United Kingdom and France. These host countries have better education and
resources that provide better health care knowledge and health care training. In these developed regions of
the word, Caribbean women receive more on and off the job training as well. Educational opportunities for
health care allow women in the Caribbean to receive advanced knowledge on nursing and their degrees are
recognized in their host countries.

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CARICOM single market and economy
All goods which meet the CARICOM rules of

origin are traded duty-free throughout the region
(except The Bahamas). Therefore all goods
originating within the region can be traded without
restrictions. In addition, most member states apply
a Common External Tariff (CET) on good
originating from non-CARICOM countries. There
are, however, some areas still to be developed:
 Treatment of products made in Free Zones –

there is need for regional agreement on how
these goods are to be treated since they are
usually manufactured at reduced tariff by
foreign companies.
 The removal of some specific non-tariff
barriers in various member-states.
Another key element in relations to goods is Free

Circulation. This provision allows for the free
movement of goods imported from extra regional
sources which would require collection of taxes at
first point of entry into the CSME and for the
sharing of collected customs revenue.
Analysis of Spice production of India market
India is one of the top most spices exporting countries in the world. In India Calicut is called the city of
spices. The top countries to export spices are as follows: India, China, Indonesia, Malaysia, Mexico, Turkey
and Brazil. India is favored with a perfect agro-climatic zone, spices of trade to 120 nations. The spice
board of India (1987) headquartered in Cochin, pays a way for the fare advancement of Indian spices by
promoting and developing it worldwide. It plays a vital role in extensive part as a formative and
administrative for Indian spices. The board is the international link between the Indian exporters and the
importers abroad. Indian spices are well known for its taste, aroma and texture. International organization
standard of 75 varieties listed out of 109 varieties are exported from India. Although exporting spices was
affected during COVID-19 spices board of India passed a circular of mandatory sampling & testing of
export consignments spices under the quality evaluation system. The top medicinal use spices are
cumin, clove, coriander, turmeric, cardamom and pepper. There are several factors which affect the export
of spices in India are low productivity, poor export quality, poor harvest, competition, rejection of export
materials and insufficient mechanization
of spice processing and international
market prediction for spices.
Rapid urbanization and changing dietary

patterns are triggering the growth of
horticulture sector in our country. The
sector has enhanced the growth of
agricultural development along with wide
choices to farmers for enhancing and
sustaining farm production and
profitability. The production of total
horticulture products surpassed the food
grain production in 2012-13 and now the
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production estimates reached a figure of 295.15 million tons from an area of 24.92 million ha. Among
various horticultural products, spices deserve a special mention since these are high valued commodities
and contribute considerable income to the total exports of Indian agricultural products. During 2012-13 out
of total agricultural exports from India, spices accounted a share of 3.3 per cent, however, it underwent
significant compositional changes over the years. India is now the spice bowl of the world with a lion share
of 73 per cent in total spice exports (FAO Stat, 2016). The diverse climatic and geographic features of the
country makes is apt for growing several spices, and these also bestow geographic indicator tag on spice
products. Currently, Rajasthan tops the list of states in both area and production of spice crops (28% of
total area and 15% of total production of spices) due to its immense potential in producing seed spices.
Seed spices like cumin, celery, poppy and coriander accounts for maximum area of spice production in the
state. In terms of production, celery, dill, and poppy seeds along with ginger and vanilla captures the major
chunk (NHB data base 2016).This document looks into the compositional changes in the spice exports of
India, and attempts to bring out the trade competitiveness for the Indian spice exports in international
markets. Spices trade decomposition along with the sanitary measures relevant for trade are also dealt.
Data Analysis
Table 1:
YEAR QUANTITY
PEPPER CARDAMOM SMALL FENNEL FENUGREEK
2015 - 2016 28100 5500 15320 33330
2016-2017 17600 3850 35150 34680
2017 -2018 16840 5680 34550 29280
2018- 2019 13540 2850 26250 27150
2019-2020 16250 2090 23800 27660
2020-2021 24018 5558 25402 34194
35150 34550 34194

33330
34680
29280 27150
28100 27660
26250 25402
23800 24018
17600 16840
15320 16250
13540
5500 3850 5680 2850 2090 5558
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
PEPPER CARDAMOM SMALL FENNEL FENUGREEK
INTERPRETATION: Table 1 represents export of pepper, cardamom small, fennel and fenugreek in
terms of quantity is forecasted to increase 147, 265.93, 196.77, 203.59 percentage respectively. This
represents export of pepper in terms of quantity and is forecasted to increase 147 percent respectively.
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Table 2:
YEAR QUANTITY
GARLIC NUTMEG AND MACE OTHER SPICES (2)
2015 - 2016 23085 4050 43955
2016-2017 32200 5070 40210
2017 -2018 46980 5500 38305
2018- 2019 29500 3300 43300
2019-2020 23350 2955 41050
2020-2021 31457 4967 41908
46980
43955 43300
41050 41908
40210
38305
32200 31457
29500
23085 23350
4050 5070 5500 3300 2955 4967
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
GARLIC NUTMEG AND MACE OTHER SPICES (2)
INTERPRETATION: Table 2 represents export of garlic, nutmeg and mace, other spices is forecasted in
terms of quantity to increase 209.78, 215.42, 220.59 percentage respectively. This represents export of
garlic is forecasted in terms of quantity to increase 209.78, percentage respectively.
Table 3:
YEAR QUANTITY
CHILI GINGER TURMERIC CUMIN
2015 - 2016 347500 347500 88500 97790
2016-2017 400250 400250 116500 119000
2017 -2018 443900 443900 107300 143670
2018- 2019 468500 468500 133600 180300
2019-2020 484000 484000 136000 210000
2020-2021 360580 360580 93960 93008
12

lOMoARcPSD|39249059
468500 484000
443900
468500 484000
400250
443900 360580
347500 400250
347500 360580
180300
210000
119000 93008
97790
143670 133600 136000
116500 107300
88500 93960
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
INTERPRETATION: This chart represents export of chilli, ginger, turmeric and cumin is forecasted in
terms of quantity to decrease 134.22, 261.20, 144.74 and 225.78 percentages respectively. This represents
export of chilli is forecasted in terms of quantity to decrease 134.22 percentages respectively.
Table 4:
YEAR QUANTITY
CELERY MINT PRODUCTS (3) SPICE OILS & OLEORESINS
2015 - 2016 5310 26550 11635
2016-2017 6250 28500 12100
2017 -2018 6480 30150 17200
2018- 2019 6100 33850 12750
2019-2020 6510 38200 13950
2020-2021 5680 25720 12471
38200
33850
30150
28500
26550 25720
17200
12750 13950
11635 12100 12471
5310 6250 6480 6100 6510 5680
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
CELERY MINT PRODUCTS (3) SPICE OILS & OLEORESINS
INTERPRETATION: Table 4 represents export of celery, mint products, spice oils & oleoresins is
forecasted in terms of quantity to decrease 116.85, 100.4 and 118.85 percentages respectively. This
represents export of celery, mint products, spice oils & oleoresins is forecasted in terms of quantity to
decrease 116.85, 100.4 and 118.85 percentages respectively.
13

lOMoARcPSD|39249059
Table 5:
YEAR VALUE
2015- 2016 399743.97 27,595.56 92,165.00 153113
2016-2017 507075.63 25,704.85 124190.65 196320.14
2017 -2018 425632.74 21,607.49 103567.63 241798.78
2018- 2019 541117.5 19,602.00 141616 288480
2019-2020 622170 44,905.00 121640 322500
2020-2021 403369.18 22179.774 101360.786 154255.612
622170
541117.5
507075.63
425632.74
399743.97 403369.18
322500
288480
241798.78
153113 196320.14 154255.612
92,165.00 103567.63 141616
124190.65 121640 101360.786
27,595.56 25,704.85 21,607.49 19,602.00 44,905.00 22179.774
2015- 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
INTERPRETATION: Table 5 represents export of chilli, ginger, turmeric and cumin is forecasted in
terms of value to decrease 154.24, 202.511, 120 and 209.06 percentages respectively. This represents
export of chilli, ginger, turmeric and cumin is forecasted in terms of value to decrease 154.24, 202.511,
120 and 209.06 percentages respectively.
Table 6:
YEAR VALUE
CELERY MINT PRODUCTS SPICE OILS & CURRY POWDER

(3) OLEORESINS & PASTE
2015- 2016 5,328.24 258130.47 214255 53,174.50

2016-2017 6,246.11 252749.67 2,45,532.80 59,910.43
2017 -2018 5,950.30 322834.86 266172.39 61,619.55
2018- 2019 6,649.00 374933.5 219300 74,470.00
2019-2020 7,175.50 383835 264525 83,410.00
2020-2021 5450.348 243778.122 227095.598 51510.782
14

lOMoARcPSD|39249059
374933.5 383835
322834.86
258130.47 252749.67 266172.39 264525

243778.122
214255 219300 227095.598
83,410.00
6,246.11 5,950.30 6,649.00 7,175.50 51510.782
5,328.24
53,174.50 59,910.43
0 61,619.55 74,470.00 5450.348
2015- 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
CELERY MINT PRODUCTS (3)

SPICE OILS & OLEORESINS CURRY POWDER & PASTE
INTERPRETATION: Table 6 represents export of celery, mint products, spice oils & oleoresins and
curry powder & paste is forecasted in terms of value to decrease 209.06, 157.44, 116.48 and 161.92
percentages respectively. This represents export of celery and is forecasted in terms of value to decrease
209.06 percentages respectively.
Table 7:
VALUE
YEAR CARDAMOM
PEPPER FENNEL
SMALL
2015 -
173041.5 44,982.75 17,239.60
2016
2016-2017 114312.6 42,150.33 30,875.93
2017 -2018 82,078.48 60,908.15 25,906.35
2018- 2019 56,868.00 35,625.00 24,412.50
2019-2020 55,187.00 42,629.50 22,888.00
2020-2021 154928.23 47505.512 23297.802
173041.5
154928.23
114312.6
82,078.48
60,908.15 56,868.00
55,187.00
44,982.75 42,150.33 42,629.50 47505.512
30,875.93 35,625.00
17,239.60 25,906.35 24,412.50 22,888.00 23297.802
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
PEPPER CARDAMOM SMALL FENNEL
15

lOMoARcPSD|39249059
INTERPRETATION: Table 7 represents export of pepper, cardamom small and fennel is forecasted in
terms of value to increase 147, 265.93 and 200.2 percentages respectively. This represents export of pepper,
cardamom small and fennel is forecasted in terms of value to increase 147, 265.93 and 200.2 percentages
respectively.
Table 8:
YEAR VALUE
FENUGREEK GARLIC NUTMEG AND MACE
2015 - 2016 23,380.70 15,959.00 20,928.25
2016-2017 18,276.49 30,711.50 23,641.65
2017 -2018 12,688.57 30,936.38 22,094.31
2018- 2019 13,846.50 17,110.00 15,015.00
2019-2020 16,383.60 17,232.50 13,630.75
2020-2021 20600.01 24600.776 23706.322
30,711.50 30,936.38
23,641.65 24600.776
23,380.70 23706.322
22,094.31
20,928.25 17,232.50 20600.01
18,276.49
17,110.00 16,383.60
15,959.00
13,846.5015,015.00 13,630.75
12,688.57
2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021
FENUGREEK GARLIC NUTMEG AND MACE
INTERPRETATION: Table 8 represents export of fenugreek, garlic and nutmeg and mace is forecasted
in terms of value to increase 206.76, 212.66 and 218.06 percentages respectively. This represents export
of fenugreek is forecasted in terms of value to increase 206.76, percentages respectively.
Summary of India spice production and demand
India is the largest producer as well as the shopper of the spices within the world. The request for spices
and its products are ever expanding both within the inner and outside markets. India incorporates a
worldwide reputation as the nation which produces nearly all sorts of spices. This study concludes that the
trend of pepper export is moving downwards from 2015-2020, in the year 2020 the trend has changed and
the export quantity increased to 20% followed by a positive forecast to increase by 147%. The trend of
chilli export quantity is moving upwards from 2015-2020 and the trend has changed to decrease in the year
2020-2021 by 116.08%. The trend of fenugreek export is moving downwards from 2015-2020, in the year
2020 the trend has changed and the export value increased followed by a positive forecast to increase by
206.7%. The trend of pepper export is moving downwards from 2015-2020, in the year 2020 the trend has
16

lOMoARcPSD|39249059
changed and the export value

increased to 32% followed by a
positive forecast to increase by
147%. The trend of celery export is
moving upwards from 2015-2021
and the export value increased by a
positive forecast to increase by
209.05. The trend of garlic export
is moving upwards from 2015-
2020, in the year 2020 the trend has
changed and the export quantity
decreased to 13% followed by a
negative forecast to decrease by
134.22%. The important spices
produced within the nation are dark
pepper, ginger, turmeric, garlic,
chilies, coriander, cumin, fennel,
fenugreek, celery, clove, cassia,
nutmeg, mace, cardamom, saffron,
vanilla and group of home grown spices. The overwhelming spices within the worldwide showcase have
far exceeded supply. India once in the past the world’s greatest maker has been hit by edit disappointments
owing to the late rainstorm downpours in 2009 and illness. The issues for Indian providers have implied
that it was overwhelmed by Vietnam as the world biggest maker, which supplies a few 30 percent of the
world’s trades. Be that as it may its claim stocks are nearly depleted, contributing to the cost rises. India is
one of the biggest Indian spice industries which acquires 40-50% of global export and the quantity has
gone over 4 lakhs tons annually.
India’s trade and investment relation with CARICOM market
India’s bilateral trade with CARICOM countries has witnessed a healthy growth in recent years. During
the last seven years India’s total trade with the CARICOM countries has risen fourteen-folds, from US$
85.5 mn in 2003-04 to US$ 1195 mn in 2009-10. Rise in both India’s exports to and imports from
CARICOM countries have underlined the increase in India’s overall trade with the region India’s exports
to the CARICOM countries have risen from US$ 61.5 mn in 2003-04 to US$ 1122.6 mn in 2009-10,
registering a compound annual growth rate of 51.3 percent during the period. India’s imports from the
CARICOM region have also witnessed a rise from US$ 24.0 mn 17in 2003-04 to US$ 271.0 mn in 2007-
08, but has declined to US$ 194.9 mn in 2008-09, further falling to US$ 72.5 mn in 2009-10, underlined
by the sharp decline in imports from Trinidad and Tobago, St. Vincent and the Grenadines, and Jamaica
during the period due to a decrease in demand on account of the global financial crisis. Among the
CARICOM countries, The Bahamas is the leading market for India’s exports, accounting for 77 percent of
India’s total exports to the region during 2009-10. Other major export destinations of India in the region
are Trinidad and Tobago, Haiti, Jamaica, Suriname Guyana, and Barbados. As regards imports from the
CARICOM, Trinidad and Tobago is the leading import source, accounting for 79 percent of India’s total
imports from the region during 2009-10. Due to the dominant share of Trinidad and Tobago, India’s trade
with CARICOM region has been in line with the trend in trade with Trinidad and Tobago. India’s major
import sources in the CARICOM region, besides Trinidad and Tobago, are Guyana, Suriname, Haiti, St.
Vincent, and Jamaica. Pharmaceutical products, primary and semi-finished iron and steel, machinery and
instruments, manufactures of metals, plastic and linoleum products, readymade garments cotton incl.
accessories, processed items, rubber manufactured products, cosmetics/ toiletries, manmade yarn fabrics
made ups, and manufactures of metals are the major items in the export basket of India to CARICOM.
Petroleum crude, gold, metaliferroussores and metal scrap, non-ferrous metals, spices, organic chemicals,
electronic goods and transport equipment are major items in India’s import basket from CARICOM.
During April 2000 to November 2010, CARICOM’s total investment in India amounted to US$ 65.1 mn.
St. Kitts and Nevis is the largest source for investment from the CARICOM region, with a share of 51.5
percent in the total FDI from the region. The Bahamas, St. Vincent and Jamaica are the other major
investors in India from the CARICOM region. During April 1996 to December 2007, India’s total outward
17

lOMoARcPSD|39249059
investment approved in joint ventures (JVs) and wholly owned subsidiaries (WOSs) in CARICOM region
amounted to US$ 4.0 mn. Trinidad and Tobago is the largest destination of India’s investments in the
region, with a share of 67.5 percent in total. Many Indian companies are present in CARICOM region in
various sectors, which include finance, iron and steel, metal, and food processing.
Prospect of spice trade from India to CARICOM
India is the world’s largest producer and consumer of spices and for a very long time has been among the
leading spice exporting countries. Upwards of three million Indian smallholder households produce spices
and hundreds of thousands of others are involved in spice processing, distribution and trade. India is unique
among the world’s major spice exporting countries in that the bulk of its spice production is used in the
domestic market. While the value of Indian spice exports has been $300-400 million in recent years, the
estimated domestic retail value of spices in India is around $4 billion. Over an extended period, the Indian
spice trade earned a reputation for product quality and marketing service. Recent regulatory changes in
selected destination markets, together with evolving requirements among major commercial buyers have
triggered a variety of responses by Indian producers and processor/exporters and by the Spices Board and
other governmental agencies. Changes continue to be made in production, post-harvest, and processing
practices and technologies; in quality assurance and supply chain management systems; and in monitoring
and testing products. The industry—via effective private and public sector collaboration—is also actively
engaged in discussions at the international level to influence the “rules of the game” for the trade in spices.
Challenges remain, however. At the commercial level, India has been encountering intensified competition
in the world market for bulk spices. Its ability to compete—on a cost basis—is constrained by the relative
dynamism of its own domestic market. As a result, increasingly, India’s spice export trade is shifting to a
range of spice oils, dehydrated products, and oleoresins for which the country maintains a major, if not
dominant, world market position. Several exporters also are seeking to develop their brands and markets
for packed consumer products. To increase competitiveness in these areas, effective use will have to be
made of the installed technological capacities that have been put in place over the past decade, plus there
is a need to intensify efforts to promote ‘good agricultural practices’ and improved post-harvest practices
among spice growers and to more generally improve the oversight of spice procurement. Additional
investments will be needed in technologies, systems, and human resources to improve spice hygiene and
quality assurance. Furthermore, measures need to be taken to better apply and enforce regulations dealing
with pesticides and domestic food safety. Given its spice industry’s past track record, India is fully expected
to meet these emerging commercial and regulatory challenges.
2015-2016 2016-2017 2017-2018 2018-2019 2019-2020
Country Total Total Total Total Total
(Values in export %Growt export %Growt export %Growt export %Growt export %Growt
US$ Million) to h to h to h to h to h
country country country country country
Total export 2,954.8 3,185.2 7.79 3,310.3 3.93 3,199.6 -3.34 3,299.2 3.11
of Spice 7 - 0 4 2 7
ANTIGUA 2.56 - 1.97 -22.99 2.17 9.72 2.71 24.91 2.19 -19.2
BAHAMAS 11.96 - 5.93 -50.36 8.07 36.07 6.06 -25 60.48 898.74
BARBADOS 10.5 - 12.35 17.65 12.74 3.16 12.43 -2.45 12.76 2.65
BELIZE 14.51 - 15.23 5 13.48 -11.54 16.98 26.03 14.27 -15.97
DOMINICA 1.46 - 2.46 68.12 2.1 -14.35 1.3 -38.46 2.17 67.58
GRENADA 1.87 - 3.02 61.72 2.64 -12.78 3.77 42.95 2.79 -25.98
GUYANA 21.87 - 20.07 -8.25 26.03 29.73 29.66 13.95 25.21 -15.01
HAITI 62.27 - 71.44 14.72 94.01 31.6 79.35 -15.59 65.51 -17.44
JAMAICA 40.21 - 43.01 6.95 52.24 21.47 55.42 6.09 56.76 2.41
MONTSERR 0.96 0.62 -35.79 0.02 -96.32 0.06 150 0.06 3.16
AT -
ST LUCIA 2.67 - 4.32 61.69 4.06 -6.19 4.01 -1.26 3.24 -19.21
ST KITT N A 2.2 - 3.09 40.44 2.87 -7.1 2.37 -17.49 2.56 7.85
SURINAME 12.86 - 10.5 -18.35 17.38 65.59 22.58 29.87 31.12 37.84
TRINIDAD 92.88 - 84.53 -9 88.69 4.93 83.75 -5.57 85.11 1.62
18

lOMoARcPSD|39249059
200
150
100
50
0
ANTIGUA
DOMINICA
GUYANA
GRENADA
HAITI
ST LUCIA
MONTSERRAT
JAMAICA
SURINAME
BAHAMAS
BARBADOS
BELIZE
ST KITT N A
Total export of Spice
TRINIDAD
-50
-100
-150
2016-2017 2017-2018 2018-2019 2019-2020
India spice trade export to Caribbean countries (2016-2020) [source: commerce.gov.in]
Above depicts the spice demand and its related percentage growth in Caribbean countries. These are
exports are populated from India Spice trade.
Total export of Spice commodity in 2019 – 2020 was $ 3299.27 million word wide. Total net export to
CARICOM countries are $ 364 million. Therefore it contributes to 11% of total export in spice commodity
specifically for Caribbean countries and continues to raise year on year.
Growth percentage worldwide in this commodity is 3.11% for year 2019-2020 .However growth
percentage for CARICOM market is much higher as 64%. Hence India spice market has great demand in
CARICOM market.
19

lOMoARcPSD|39249059
Appendix
1. Global Marketing – by Dr. Gautam Dutta
2. Government of India, Ministry of Commerce and Industry

www.commerce.gov.in/trade-statistics/
3. Caribbean Community
https://en.wikipedia.org/wiki/Caribbean_Community
4. CARICOM Single Market and Economy

https://en.wikipedia.org/wiki/CARICOM_Single_Market_and_Economy
5. INTERNATIONAL MIGRATION PAPERS 61 Economic Integration in the Caribbean: The

development towards a common labor market
https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.517.6196&rep=rep1&type=pdf
6. Delivering and Taking the Heat Indian Spices and Evolving Product and Process Standards
http://documents1.worldbank.org/curated/en/641221468267354438/pdf/370560IN0Spices0st
andards01PUBLIC1.pdf
7. TRADE POLICY AND STRATEGY, TRINIDAD AND TOBAGO 2013-2017

http://www.sice.oas.org/CTYindex/TTO/INDPolicy_1317_e.pdf
8. TRADE POLICY AND STRATEGY 2013-201

https://tradeind.gov.tt/wp-content/uploads/2016/03/TRADE-POLICY-AND-STRATEGY-
FOR-TRINIDAD-AND-TOBAGO.pdf
9. Journal of Contemporary Issues in Business and Government Vol. 26, No. 2, 2020
10. CARICOM Single Market and Economy

https://caricom.org/our-work/caricom-single-market-and-economy/
20

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Caricom market and Indian spice trade - IMM Project

Executive Post Graduate Diploman in Internatinal Business (Indian Institute of Foreign

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Economic potential of CARICOM common market and

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2. CARICOM: Background and Development 4

3. History of Economic Integration 5

5. CARICOM: Trade with the World 7

6. CARICOM Countries and their economic potential 8

7. CARICOM single market countries 8

8. CARICOM members average GDP 8

9. CARICOM members average HDI 8

10. Natural resources 9

11. Unemployment rate 9

12. Labor force and globalization 9

13. CARICOM single market and economy 10

14. Analysis of Spice production of India market 10

15. Data Analysis 11

16. Summary of India spice production and demand 16

17. India’s trade and investment relation with CARICOM market 17

18. Prospect of spice trade from India to CARICOM 18

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Downloaded by Pratiksha Sande (pratikshasande19@gmail.com)

CARICOM: Background and Development

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History of Economic Integration

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Downloaded by Pratiksha Sande (pratikshasande19@gmail.com)

CARICOM: Trade with the World

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CARICOM Countries and their economic potential

CARICOM single market countries

Name Join date

CARICOM members average GDP [2020 estimate]

• Total - $145.3 billion

• Per capita - $18,289

CARICOM members average HDI [2018 estimate]

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Country Unemployment rate (%)

Labor force and globalization

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CARICOM single market and economy

All goods which meet the CARICOM rules of

 Treatment of products made in Free Zones –

Another key element in relations to goods is Free

Analysis of Spice production of India market

Rapid urbanization and changing dietary

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35150 34550 34194

5500 3850 5680 2850 2090 5558

2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021

PEPPER CARDAMOM SMALL FENNEL FENUGREEK

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4050 5070 5500 3300 2955 4967

2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021

GARLIC NUTMEG AND MACE OTHER SPICES (2)

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2015 - 2016 2016-2017 2017 -2018 2018- 2019 2019-2020 2020-2021

CHILI GINGER TURMERIC CUMIN

5310 6250 6480 6100 6510 5680