As far as the eye can see, aquaculture ponds stretch across the landscape of Tundurru village in the Andhra Pradesh’s West Godavari district. Coconut trees bordering the ponds and remnant paddy fields break the monotony. Villagers point to barren land parcels soon to be converted into aquazones, as nothing else grows in the region any more.
For decades, shrimp has been the most popular choice among Andhra Pradesh’s aquaculture farmers. Despite stagnant prices in recent years, it remains their best bet. Shrimp is grown in several other States too, including West Bengal, Odisha, Tamil Nadu, and Kerala, but Andhra Pradesh accounts for 75-80 per cent of the country’s production. However, most of the harvest is not for domestic consumption. It is processed and shipped out to international markets.
In 2023-24, shrimp exports earned about $4.88 billion (over Rs.40,000 crore). The US was the single largest market, absorbing over 40 per cent of our frozen shrimp. Until US President Donald Trump imposed reciprocal and penal tariffs on India.
Until March 2025, the US tariff on Indian shrimp was 8.26 per cent (2.49 per cent anti-dumping duties and 5.77 per cent countervailing duties). On April 2, Trump announced reciprocal tariffs (26 per cent on India), but paused them temporarily on April 9 for 90 days. A baseline tariff of 10 per cent prevailed as trade negotiations continued. The US market for Indian shrimp has three crucial segments: restaurant chains, supermarket stores (such as Walmart), and street vendors. According to experts, the first two segments were able to absorb the cost in April, and exports did not falter.
As trade talks stalled, a 25 per cent reciprocal tariff was imposed on Indian goods, including shrimp, starting from August 1. Then came a bolt from the blue, when Trump imposed an additional 25 per cent tariff to punish India for its Russian oil imports. The Global Trade Research Initiative, an Indian think tank, estimated that farm-gate prices had declined by 20 per cent by early August, even before the punitive tariff took effect on August 27.
Also Read | The weavers wait in Bhadohi
As of that date, the tariff on Indian shrimp exports stood at 58.26 per cent. In contrast, the effective tariff on Ecuadorian shrimp (a key competitor of India in US markets) is 18.78 per cent. Most exporters front-loaded their stocks before the August 1 deadline to bypass the tariff. Some of those shipments have yet to reach the US. Crisil Ratings has predicted that shrimp exports in the current fiscal will fall by 15-18 per cent and revenues will decrease by 18-20 per cent.
For the trade deal to materialise, the US expects India to open up its agricultural markets and to retreat from oil trade with Russia. The impasse on the trade deal persists, and industry leaders are engaged in negotiations with alternative markets, including China and Russia. In early September, over 100 fishery establishments were approved by the European Union, enhancing the demand for Indian shrimp. But supply chain shifts take time and deals are not made overnight.
Over-dependence on US backfires
K.N. Raghavan, Secretary General of the Seafood Exporters Association of India (SEAI), said: “Exports to the US have come down by about 80 per cent. Street sales have almost stopped.”
The over-dependence on US markets, which once aided the shrimp boom, has now become a vulnerability. Speaking to Frontline,Raghavan said: “The international trade was governed by norms that were pushed forth by the US. No one expected that the US would suddenly take a 180-degree turn. But now we realise that even the US can change its stance and build a tariff barrier.”
The cascading effect of the tariff has begun to impact the most vulnerable actors in the supply chain—small farmers and workers. For decades, shrimp has been the surest way for farmers to break the cycle of low profits or debts in agriculture.
The shrimp story
Rajesh Yedida, general secretary of Human Rights Forum Andhra Pradesh, said: “It all began in the mid-1980s. The aspirations of higher incomes remained unmet by paddy. Tales of shrimp farms changing fortunes spread quickly, and so did the extent of area under shrimp.” The first boom came in the 1990s, followed by a bust in 1995. Then, a widespread disease afflicting tiger shrimp prompted the export market to adopt Whiteleg shrimp or vannamei in 2009-10. Litopenaeus vannamei, commonly known as vanami, accounts for 90 per cent of the exports.
“In Tundurru, on about 4,000 acres under ayacut (lands designated to receive irrigation water), of which about 3,200 acres have been converted to aquaculture ponds over the decades. We have recently requested that another 100 acres be added to the aquazone,” Areti Vasu, the Mandal Parishad representative from Tundurru said.
Between 2015-16 and 2023-24, the land under shrimp aquaculture in Andhra Pradesh more than doubled, reaching 2.5 lakh acres. The government’s push to increase aquaculture persists. While the perception is that the shrimp aquaculture consists of a large number of small-scale farmers, it is, in fact, a highly fragmented and diversified sector. The government data obscures the scale of the farms and the complexities of operations.
Siddharth Chakravarty, a research scholar at the School of Business and Management, Queen Mary University of London, said: “At one end, you have households operating a pond, which could be an acre in size. At the other end of the spectrum are vertically integrated farmers (who own a production or feed unit or export business) with farms spanning several thousand acres. And between these two extremes are different scales of farmers as well.”
The high investment needed, about Rs.4-6 lakh per acre, is a barrier for entry in shrimp aquaculture, but so is caste. Narsingarao, a shrimp farmer who leases nearly 10 acres, said that in his village, most aqua farmers, feed suppliers, and creditors belong to the same caste (a dominant caste). “Trust is implicit,” he added.
At a fish farm near Bhimavaram in West Godavari district, on September 10. Large tracts of farmland in West Godavari and Krishna districts have been converted into aquaculture ponds for fish and shrimp farming, thanks to higher profitability compared to paddy cultivation. | Photo Credit: G.N. RAO
Govinda Rao of Tundurru owns one acre and leases 10 acres. Forty-four-year-old Rao moved from paddy to aquaculture farms nearly 15 years ago. He takes credit from the feed supplier and sells the harvest to the same person. His feed supplier is also a farmer, but operates at a much larger scale. In all these years, Rao has never experienced losses, but neither has he made enough profits to purchase even one more acre.
In Challapalli village of BR Ambedkar Konaseema district, Chanti, a shrimp farmer, runs an export business. But even he takes credit from the feed supplier. Across Andhra Pradesh, where shrimp aquaculture is the mainstay, similar stories unfold. Those who can tide over a bad harvest undertake shrimp monoculture, and those who want a buffer have been opting for either polyculture (comprising fish and shrimp) or paddy over a small extent. Some farmers, who cannot risk losing any investment, grow paddy twice a year.
“In paddy, the profits are low, but so are the losses. Shrimp needs someone who can take a risk on a high investment of Rs.4-5 lakh,” a paddy farmer of Tundurru said. He owns an acre and leases a couple of additional acres. Those who were unable to continue with even paddy cultivation have migrated to Hyderabad for work.
While lakhs of farmers are involved in aquaculture, at the top there are fewer than a dozen companies that dominate the export market. Chakravarty said: “The tariff would have a disaggregated impact on farmers depending on the scale of their operations, on their financial standing, social relations of borrowing, lending, formal or informal finance, and so on. The farmers who own or lease a small piece of land are the most vulnerable to tariffs.”
Even as some farmers are threatening a crop holiday or quitting shrimp altogether, most agree that it is impractical. “One may decide to reduce the extent of leased farming till the situation tides over. But once you have dug a pond, there is no way out,” said Rao. “Like small farmers, workers would be impacted much more than other players because of the absence of a cushion or safeguard to protect them during market volatility,” said Chakravarty.
Shrimp sector conditions
The competitive advantage the country’s shrimp sector has over Ecuador is “cheap labour”, as industry experts call it. The work is often informal, contractual (although often without formal documentation), and mediated by middlemen. It comes at the cost of inadequate wages, long work hours, hazardous working conditions, and a lack of social security nets. In 2024, the sector came under fire for exploitative practices, following a US whistleblower exposé. Union leaders recount instances of having to exert pressure for even basic amenities, such as an adequate number of bathrooms.
Out of the 493 registered production units in the country, 378 units are located in Andhra Pradesh. These units not only absorb landless labour from nearby villages, but also fisherfolk who no longer get sufficient work, as well as migrant workers from Odisha, Jharkhand, Chhattisgarh, and Bihar. While men are employed for most farm work (such as feeding and harvesting), the processing units predominantly employ women workers. Experts anticipate that if tariffs prevail, workers will face further pressure, including reduced shifts and job losses. Trade unionists told Frontline that in subcontracted production units, the number of shifts and jobs is in decline following a slump in exports.
G. Baby Rani, a CITU leader from Andhra Pradesh, said: “The wages had just begun to increase after years of consistent campaigning (from Rs.200 to Rs.300, or Rs.350, per day). It is not minimum wage. Tariffs have put us in a position where we won’t be able to negotiate anymore.”
For nearly a decade, Rani has been working on labour issues and bringing into focus the exploitation of shrimp sector workers. “Recruitment of workers happens through contractors around the shrimp harvest cycle. From some pockets, we are hearing news about a temporary freeze,” she said. Industry experts noted that preventing job loss depends on the pace at which exporters find a foothold in alternative markets. The impact of the tariffs and shifting markets is expected to be felt more acutely by workers in the coming months, depending on the type of shrimp exported and the countries to which it is exported.
For instance, the US imports mainly headless frozen shrimp, which involves a strenuous process but generates piecemeal work in India. However, markets such as China primarily import head-on shrimp, which eliminates one step in the processing.
Stagnation in sector
But all was not well even before the tariff. “The sector has been experiencing a slump for the past few years,” said Rajesh Yedida from HRF, who feels a pattern similar to paddy is emerging in aquaculture. “Over the last decade, production has gone up, and supply has been abundant. The world was forced to consume shrimp, so prices are not going up,” Yellanki Ravi Kumar, president of All India Shrimp Hatcheries Association, told Frontline.
Ravi Kumar’s statement is reflected in the export figures. In 2023-24, vannamei exports increased by 0.33 per cent in volume; however, they declined by 11.56 per cent in value, from $4,809.99 million to $4,253.86 million, according to PIB data.
As prices remained stagnant in global markets, the incomes of small farmers got squeezed. A research paper published by ICAR-CIBA researchers, titled “Is the price volatility risk in shrimp farming manageable and can profitability be sustained?” and published in November 2024, shared findings that revealed patterns similar to those narrated by farmers. By tracking time series data, the researchers found that while production costs have increased gradually, the corresponding prices have been on a declining trend over the years.
At a shrimp processing and packing plant near Bhimavaram in West Godavari district. Andhra Pradesh accounts for a lion’s share of the country’s shrimp exports. | Photo Credit: G.N. RAO
Farmers also accuse buyers and processing units of forming a syndicate that works against honouring fixed prices or the prevailing rate. In 2022, Andhra Pradesh formed a committee to oversee similar concerns. The empowered committee set a fixed price, but farmers reported that even back then, many buyers did not comply.
Outbreak worries
Disease outbreak is also a major worry. “Recurring diseases are making Indian shrimp a risky investment. The transmission of disease has to be stopped with biosecurity protocols and other pre-emptive measures,” said Ravi Kumar. “In most years, the investment is always recovered. The extent of profits depends on the export market and protecting shrimp from diseases,” said Rao.
A study by the Indian Council of Agricultural Research-Central Institute of Brackishwater Aquaculture (ICAR-CIBA) concluded that between 2021 and 2023, the country lost shrimp worth Rs.7,112 crore each year to diseases. The estimated annual losses in Andhra Pradesh alone were Rs.3,975 crore. The fisheries department implements the National Surveillance Programme for Aquatic Animal Diseases in all coastal States. Still, experts such as Ravi Kumar say that the country needs to adopt a more scientific approach to curtail the disease burden.
“Can the supply be regulated? No. Over time, it could come down. Reducing the extent of acreage might also be beneficial for farmers. The need of the hour is internal consumption. There should be some incentivisation for that,” Ravi Kumar said. Cited Brazil as an example, he said that the South American country transformed an export-oriented shrimp sector to focus on domestic consumption, following duties and disease burdens.
Our shrimp sector also needs to address foundational issues, such as developing an indigenous pathogen-free broodstock, Raghavan said. Currently, the broodstock is mostly imported.
The current tariffs are not the only cause of concern for the shrimp industry. In September, US senators introduced the India Shrimp Tariff Act to protect their domestic markets. The Southern Shrimp Alliance (SSA), a US-based organisation of fishermen, processors, trawlers, and others, is lobbying to penalise India for “harming” the domestic shrimp markets of the US with cheap exports. The SSA views the Tariff Act as a long-term solution. It also proposes a 10 per cent duty starting January 2026, scaled up to 40 per cent by 2028.
Also Read | US tariffs deepen the crisis in Gujarat’s diamond industry
“Diversification is the need of the hour, not only in terms of exploring new markets but also in expanding the product range. Value-added products, such as sashimi, fried rice, and breaded shrimp will find better markets where these products will move faster. The sector will introspect and plan how to position itself for the next two decades,” said Raghavan.
The Central government has revised GST on value-added shrimp (from 12 per cent to 5 per cent). The GST on engines, pumps, and aerators has also been reduced to 5 per cent (from 12-18 per cent), which the government hopes will alleviate the burden on farmers.
In September, Andhra Pradesh Chief Minister Nara Chandrababu Naidu announced that the government has reduced the maximum retail price of of aqua feed by Rs.9 per kg. However, farmers are of the opinion that all this is not enough to help recover from the longstanding stagnant prices, let alone the recent tariffs.
The SEAI has requested the Centre government to increase credit limits to improve cash flow and also requested a subsidy package. Naidu has sought Central assistance for aqua farmers and bank support for exporters and aqua companies, including a 240-day moratorium on loans and interest repayments. The Centre has acknowledged the disruption caused by tariffs in the shrimp sector but has not made any major announcements yet. It appears to be in a wait-and-watch mode.
COMMents
SHARE