The budget has brought little cheer to the traditional and small-scale fishers

In the recent Union Budget, Nirmala Sitharaman, the finance minister has proposed to increase India’s annual fish production to 20 million tonnes. How good is that an idea when fisheries sector is marred with misplaced subsidies and unsustainable fishing practices? Gaon Connection takes a deep plunge

Nidhi Jamwal
Environment Editor| Updated: February 4th, 2020

Kochi, Kerala

On February 1, Nirmala Sitharaman, the Union finance minister presented the Union Budget for the financial year 2020-21 in the Parliament. Among many other things, she referred to the blue economy and said the government “proposes to put in place a framework for development, management and conservation of marine fishery resources.”

Sitharaman has proposed raising the annual fish production in the country to 20 million tonnes by 2022-23. Growing of algae, sea-weed and cage culture is also set to be promoted.

Simply put, blue economy means economic activities dependent on marine resources. As per a document of the NITI Aayog, “development of blue economy can serve as a growth catalyst in realizing the vision to become a $10-trillion economy by 2032.”

However, the budget and its announcements have brought little cheer to the traditional and small-scale fishers in the country.

“In the name of blue revolution or blue economy, the government is giving away our sea to the industries and other economic activities. A shipping corridor is planned, and wind and solar farms are also being proposed in the ocean. Where will we small-scale fishers go for fishing,” asked T Peter, general secretary of National Fishworkers’ Forum, the only federation of small and traditional fishworkers’ union in India registered under the Trade Union Act, 1926.

“Because of the destructive fishing practices of large-scale operators, such as trawling and purse seine fishing, fish catch has already declined sharply. Small-scale fishers are forced to go deeper into the sea, which means additional fuel (diesel) consumption,” said Peter. “Rather than supporting us, there is a pressure to do away with our fuel subsidies. Without the government support, small-scale marine fishers cannot survive,” he added.

The National Fishworkers’ Forum is already worried about 2020, which is expected to be a make or break year for traditional marine fishers in the country.

The United Nations Sustainable Development Goal 14 (SDG14) aims to ‘conserve and sustainably use the oceans, seas and marine resources’. The ‘target 14.6’ of the SGD14 reads: “By 2020, prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, and eliminate subsidies that contribute to illegal, unreported and unregulated (IUU) fishing, and refrain from introducing new such subsidies, recognising that appropriate and effective special and differential treatment for developing and least developed countries should be an integral part of the WTO fisheries subsidies negotiation.”

A fishing boat with more than 300 horsepower engine brings about 7,501 kilogram fish per trip, of which 30 per cent is trash fish

A large number of international reports point towards subsidies leading to overfishing. The worst kind of subsidies, it is claimed, are those that reduce fishers’ operating costs, thus promoting over-fishing. Such subsidies include support for cheaper fuel, gear and shipping vessels.

A document by the OECD [Organisation for Economic Co-operation and Development] says “access to these types of inputs at below-market rates increases fishing activities and ultimately leads to depletion of fish stocks, lower fishing yields, and decreased incomes for fishers. These kinds of subsidies also tend to favour larger fishers, not the smaller, traditional fishers who are considered most vulnerable.”

“We are fishing down the marine food web. Subsidies offered by the governments are facilitating overfishing. Every year, 10 million tonnes of fish are lost globally due to overfishing,” Ussif Rashid Sumaila, professor and director of the Fisheries Economics Research Unit, Institute for Oceans and Fisheries at the University of British Columbia, Canada told Gaon Connection.

At the World Trade Organization (WTO), the Negotiating Group on Rules is already holding a cluster of fisheries subsidies meetings to seek members’ views to be able to reach a meaningful outcome at the 12th Ministerial Conference set to be held at Nur-Sultan, Kazakhstan in June this year. 

So far, India has made a strong case at WTO for continuing fisheries subsidies. Last year, it argued that “its subsidies per fisherman amounted to less than $0.10 per day and it is the large subsidisers who needed to be disciplined”.

Fisheries subsidies and overfishing

According to Sumaila, the annual global fisheries subsidies is estimated to be US $35 billion, of which more than US $22.2 billion is for ‘capacity building’, US $10.6 billion is ‘beneficial’ subsidies and US $2.5 billion is ‘ambiguous’ subsidies. ‘Capacity building’ subsidies (mostly fuel subsidies) artificially reduce the costs of fishing by allowing vessels to take ever more fish on longer trips, ever further from land. These subsidies are considered harmful.

Of the total US $35 billion subsidies, a large chunk — US $29.8 billion, or 84 per cent — goes to the large-scale fisheries sector. And, within the large-scale sector, almost 60 per cent subsidies is for ‘capacity-enhancement’ (see chart 1: Global fisheries subsidies magnitude and distribution).

Chart 1: Global fisheries subsidies magnitude and distribution. Source: Sumaila et al. (2016); Schuhbauer et al. 2017)

Food and Agriculture Organization (FAO) of the United Nations warns 33 per cent of the world’s assessed fish stocks are overexploited, while 60 per cent are exploited at their maximum sustainable level. The share of overexploited stocks is steadily increasing and has tripled since the 1970s.

“Five countries — China, Taiwan, Japan, South Korea and Spain — amount for 64 per cent of high seas fishing revenues. If subsidies are removed, 54 per cent of the high seas fishing won’t be profitable,” said Sumaila, who has been strongly advocating a complete ban on fishing in the high seas. 

Fisheries highly-subsidised in developed countries

A look at the country-wise data on fisheries subsidies shows how this sector is highly-subsidised in the developed countries and China (see table 1: Fisheries subsidies: India vs other countries).

Source: Sumaila et al. (2019)

Annually, China offers maximum fisheries subsidies to the tune of US $5,952 million, of which more than 92 per cent is for ‘capacity building’ that encourages overfishing. The annual fisheries subsidies in the USA stand at US $3,553 million, of which more than 35 per cent is for capacity enhancement.

In sharp contrast, India’s annual fisheries subsidies is US $278 million. This is 7.8 per cent and 4.6 per cent of the annual fisheries subsidies in the US and China, respectively.

Of the total annual fisheries subsidies in India, more than 62 per cent is categorised as ‘capacity building’. Experts suggest translating ‘capacity enhancement’ subsidies to ‘beneficial’ subsidies, such as insurance, livelihood to fishers through conservation, etc.

“The Indian government offers subsidies to fishers, which are part of welfare subsidies for education, health and housing, as fishing community is economically weak. These subsidies should be there,” K Sunil Mohamed, principal scientist and head of Molluscan Fisheries Division at the Central Marine Fisheries Research Institute, Kochi told Gaon Connection.

“But there are components of the subsidy, such as fuel subsidy, which can be relooked at, as it leads to over-capacity. We already have a certain amount of over-capacity in our system that needs to be reduced,” he added.

Break-up of various types of subsidies in the fisheries sector shows a large chunk of fuel subsidies, which promote over-fishing, is offered by the developed countries (see chart 2: Global fisheries subsidies break-up). And, majority of these subsidies are cornered by the large players in the fisheries sector. Traditional and small-scale fishers can barely make both the ends meet.

Chart 2: Global fisheries subsidies break-up. Source: Sumaila et al. (2019)

“Just like the agriculture sector, the fisheries are highly-subsidised in the rich countries. We poor small-scale fishers in India stand no chance to compete with the global fishers. In the name of WTO, if the government takes away our fuel subsidies, we will starve,” said Peter.

“In India, for each litre of diesel or kerosene purchased by a fisher, the subsidy component is about Rs 9. A big boat of deep-sea fishing gets an annual fuel subsidy of about Rs 9-10 lakh. In contrast, a small-scale fisher, who consumes less fuel, ends up receiving very little subsidy,” informed Ramachandra Bhatta, marine resources economist with the College of Fisheries, Mangaluru, Karnataka.

“In the case of income tax, as incomes increases, the tax rate increases. But, in fisheries subsidies, owners of a large vessel receive more subsidy than traditional small-scale fishers. This needs to change,” he added.

According to him, large players, such as trawlers, are depleting the oceans of their marine wealth.

From 11 million tonnes to 20 million tonnes a year

Sitharaman has proposed to increase India’s fish production to 20 million tonnes per annum in the next three years. However, there is a flip side.

Almost 50 per cent of the total fish catch in the country is for non-direct consumption and goes to fishmeal and fish oil factories, which is an input for export-oriented shrimp aquaculture and surimi (a paste made from fish). India exports 75-80 per cent of farmed shrimp to EU/US/Japan. India also exports around 96,000 tonnes of surimi per year and it requires four kilogram of raw fresh fish to produce one kilogram of surimi.

“At 11 million tonnes per year, India is the second-biggest producer of fish. Almost 60 per cent of the total fish catch in the country comes from subsidised trawling,” said Bhatta.

“The estimated landing of low-value by-catch in trawl fisheries has increased from 14 per cent in 2008 to 25 per cent in 2011, and now it stands at 35-40 per cent. A non-edible trawl landing consisted of 237 species/groups of marine fauna with juveniles of commercially important fishes,” he added.

This has both ecological, social and health concerns. Indiscriminate ‘biomass fishing’ to convert by-catch into target catch is highly unsustainable. It is also a food security threat, as the fishmeal and fish oil industry convert relatively cheap small fish, which could have been affordable food to poor, into higher-priced fish and shrimp, mainly for rich consumers in export markets.

Studies carried out by Bhatta and others show how large fishing vessels are wiping out marine wealth. For instance, a fishing boat with more than 300 horsepower engine brings about 7,501 kilogram fish per trip, of which 30 per cent is trash fish. In case of a less than 140 horsepower engine boat, the trash fish is about 10 per cent.

“There needs to be more government control over fishmeal and fish oil industry to the extent of their capacity and the manner in which they are sourcing their catch. At the moment, this industry’s demand is driving the unsustainable practices in the fisheries sector,” said Mohamed.

Clearly, it is the large players in the fisheries sector and the developed countries that need to put in place effective measures to control overfishing. The interest of traditional small-scale fishers must be protected.