International food safety regulation and processed food exports from developing countries: A comparative study of India and Thailand

India, Thailand

Professor Prema-Chandra Athukorala
Phone: 02 6125 8259
Fax: 02 6125 3700
Email: prema-chandra.athukorala@anu.edu.au

• Research Information Systems for the Non-aligned and Other Developing Countries, India
• University of Melbourne, Australia
• International Food Policy Research Institute, USA
• Thammasat University, Thailand

$621,895

01/01/2002 - 31/12/2004

01/01/2006 - 31/12/2007

Dr Simon Hearn

India and Thailand, like a number of other agricultural resource rich developing nations, have experienced significant expansion of processed food exports. In recent years Thailand has exported over US$10 billion worth of processed food (4 per cent of GDP) and India over US$3 billion worth (2 per cent of GDP). However, both India and Thailand, and other developing countries, have experienced significant problems in exporting processed food to lucrative markets in developed countries. These trade conflicts often relate to food safety standards and their inability to meet the WTO Sanitary and Phytosanitary (SPS) Agreement. For example in 1999-2000 there were 860 shipments of fishery, vegetables and fruit products from India placed in detention in the US and 684 cases of products from Thailand.
SPS issues have become a significant source of international trade friction and dispute. While the development of food processing export industries offers enormous potential for rural development and economic growth in developing countries, problems with meeting these standards are considered a major constraint to achieving this growth. There is particularly a lack of adequate information on the problems that constrain firms' ability to meet international standards.

This study examined the policy, institutional and technical problems faced by processed food exporters in developing countries in meeting SPS requirements, and sought to identify appropriate policy measures to minimise their negative impacts on exports and enhance their capacity to meet SPS standards while recognising the legitimate concerns in importing countries about safety and quality.

The core of the project was an in-depth comparative study of the export-orientated processed food industries in India and Thailand, including detailed case studies of the food-supply chain of their processed fish, canned fruit and meat industries. In the first stage, a quantitative and qualitative database was developed to obtain a detailed national overview of the constraints relating to meeting SPS standards. Interviews were conducted with government representatives, scientific personnel, administrators of export quality control and industry representatives.
The second component of the study involved a detailed supply-chain study of selected industries, which involved a firm-level survey. A sample of about 200 firms in each country was selected with a view to obtaining complete data on at least 50 firms. The following regions and products were covered in the study.

India:
Andhra Pradesh (shrimp, tuna, poultry, mango)
Maharashtra (poultry, shrimp, tuna, mango)
Kerala (shrimp, tuna)

Thailand:
Bangkok and surrounds (shrimp, pig meat and tuna)
Eastern Thailand (tuna, pig meat, pineapple)
Southern Thailand (shrimp, pineapple, mango)

The main tasks accomplished by the project were:
a literature survey
a survey/analysis of trends and patterns of process food exports from developing countries with emphasis on the experiences of India and Thailand
a survey/analysis of trade-related regulation in the global food system and WTO mechanism for monitoring food safety standards
documentation/analysis of institutional mechanisms and procedures for meeting food safety standards in India and Thailand
preparation of case studies of the selected food industries and firm-level surveys in India and Thailand, and draft country reports.
A workshop was held at the Australian National University in June 2005 elicited comments/suggestions on the research output for the preparation of the final report. The participants included the ACIAR reviewers from IFPRI and ABARE and a number of prominent economists in this subject area. Two dissemination workshops were held in New Delhi and Bangkok in September 2005.
The reviewers assessed the project favourably, noting that it had 'substantially contributed to the research area and largely achieved the key objectives outlined in the project proposal'. Based on reviewers' recommendation, a one-year extension was approved for dissemination activities.
The research team made good progress towards producing a major book (research monograph) by expanding/revising the draft papers presented at the ANU workshop. A short policy manual (based on the book) targeted the public-sector and private-sector audiences engaged in addressing food safety standards and export performance in India and Thailand.