Kashmir: Rising Imports a Tough Nut to Crack for Walnut Industry

Anantnag, Jammu and Kashmir: Getting out of the Rs 4 lakh debt accumulated through walnut trading was not easy for Abdul Majeed Itoo (65). He had to sell his two kanals (0.25 acres) of land for that in 2022, which he describes as the most difficult phase of his life.

Itoo belongs to Shangus in Anantnag, a district that tops in walnut cultivation in Kashmir region. He began walnut cultivation on his 10 kanal (around two acres) plot in 1981 and started buying walnuts from other small farmers in 1989. His produce would fetch him around Rs 2 lakh annually, while he would trade in walnuts worth another Rs 2 lakh by making purchases from small farmers.

“In 1989, walnuts fetched Rs 500 per mann (40 kg),” he said, noting it was equivalent to Rs 20,000 of today. “By 2016, prices skyrocketed to Rs 12,000 per mann.”

Everything was going well until the prices collapsed to Rs 5,000-7,000 per mann in 2018. That year, Itoo had bought walnuts based on previous year’s rates, expecting a profit of Rs 2,000 per mann. Instead, prices crashed further. “After adding labour, packing, transport and other charges, I suffered a massive loss. I fell into debt and was unable to pay small farmers, labourers and shopkeepers,” he said.

Noor Ahmed Ganie from Anantnag has been into walnut farming and trading for 18 years, but he is considering quitting now. "I owe Rs 50,000 to farmers... The same walnut that I sold for Rs 250 per kg in 2019 now sells for 90," he lamented.

His 15 trees once yielded more than Rs 1 lakh, and trading brought in Rs 5 to 6 lakh, with a Rs 2 lakh profit. Now, he barely generates a revenue of Rs 2 to 3 lakh from all the walnuts. "We barely get the amount of labour we put in," he said. Labour usually costs half the amount with which the crop is bought. For example, if the crop is bought at Rs 1 lakh, it will take a farmer Rs 50,000 more to make the crop market-ready.

Ghulam Nabi (65) from Bijbehara collects walnuts from households and sells them in Jammu. “I now sell the same quantity of walnuts for nearly half the price compared to a few years ago,” said Nabi, who owns only one walnut tree, but used to purchase walnuts worth lakhs from small farmers and households, earning a profit of Rs 3 to 4 lakh annually. After accounting for expenses, his earnings have now dropped to just Rs 1 lakh per year.

Hybrid influx

Jammu and Kashmir produces over 95% of India’s walnuts. Chemical use is minimal as climate variations have little impact on walnut production here. Mostly urea is used once in three to four years.

"Walnuts can grow even in Ramban and Poonch, where temperatures reach 40°C. Since Kashmir’s extremes are 36-38°C, the produce remains unaffected,” explained Dr Imtiyaz Ahmad Lone, Professor, Department of Horticulture, Sher-e-Kashmir University of Agricultural Sciences and Technology-Kashmir (SKUAST-K).

Even if farmers want to use chemicals, the cost would be too high due to the towering size of walnut trees. "Unlike California’s smaller hybrids, treating 30 m trees with 18 m canopies is nearly impossible," said Lone.

Despite being one of the finest varieties, Kashmiri walnuts struggle to compete in the market due to imports from California, China and Chile. Farmers across the valley claim that the increasing market share of imported walnuts has driven down the prices of Kashmiri walnuts.

"Imported walnuts are hybrids — they are larger in size, more visually appealing and have a whiter kernel compared to Kashmiri walnuts," said Bahadur Khan, president, Kashmir Dry Fruit Association, explaining why there was a lesser demand and a resultant price drop.

However, in terms of taste and nutritional value, the imports fall far short. Dr Thameed Aijaz, Assistant Professor, Department of Food Technology, Islamic University of Science and Technology, Awantipora, told 101Reporters that Kashmiri walnuts have a much higher oil content. “This makes them a healthier option than hybrid varieties."

A 2017 study titled Kashmir walnuts: study on fatty acid composition and antioxidant activity analysed Kashmiri walnuts using gas chromatography. It found polyunsaturated fatty acids (PUFA) to be the most abundant — 73.89% in the black variety and 65.74% in the brown variety. Monounsaturated fatty acids (MUFA) were higher in the brown variety (26.21%) than in the black (18.17%). The brown variety also showed stronger antioxidant activity. The study concluded that Kashmiri walnuts, rich in MUFA, PUFA and antioxidants, are beneficial for heart health and superior to hybrid varieties such as Californian and Chilean walnuts.

Khan pointed out that buyers in metro cities and other places prioritise appearance over quality, focusing on the size and colour of the walnuts rather than their taste or nutritional benefits. “The smaller size and faded colour of Kashmiri walnuts definitely put them at a disadvantage against the imported varieties,” he stated.

Acknowledging this, Faisal Mir (28), the owner of Ganie Dry Fruits in Batla House, Delhi, said most people are unable to differentiate between imported and Kashmiri walnuts. “Customers prefer Californian or Chilean walnuts over Kashmiri ones, which are also more expensive,” he said.

Ghulam Nabi checks the quality of walnuts he purchases from a household in Anantnag before selling them to a walnut dealer (Photo - Mohammad Aatif Ammad Kanth, 101Reporters).

The curse of imports

During the 2022-23 marketing year, Turkey, India and Italy emerged as the top importers for Chilean walnuts. The Chilean walnut export industry has heavily focused its marketing efforts on expanding in India, resulting in a 108% increase in exports to India. India has now become Chile’s largest market for in-shell walnuts, overtaking Turkey. The trade value rose to $125.48 million, up from $64.28 million between 2021-2022 and 2022-2023, a sharp 95.2% increase.

Similarly, the trade value of Californian walnuts after tariff removal rose from 1,496 metric tonne in January 2023 to 3,538 metric tonne in January 2024. This has not only reduced the demand for Kashmiri walnuts, but has also caused significant losses for Kashmiri traders, forcing many to leave the profession.

According to walnut export data, India exported 638.07 metric tonne walnuts to the world for Rs 20.02 crore during 2023-24, to Netherlands, the UK, the Middle East, etc. This export is marginal compared to India's total walnut production and the volume of imports.

Figures available with Jammu and Kashmir Horticulture Department reveal that walnut production in Kashmir reduced to 1,80,973 MT in 2019-2020 compared to 1,95,066 MT in 2018-2019. Stressing the need to increase tariffs on foreign walnut imports to safeguard Kashmir’s rural economy, Dr Imtiyaz Wani, Assistant Professor, Department of Horticulture, SKUAST-K, and author of Walnut production technology under Kashmir conditions, highlighted that a large number of farmers in the rural belts rely on walnut farming for additional income.

As per the department’s data for 2021, walnut cultivation spanned 95,601 hectares, accounting for 85.05% of the total area under walnut farming in India. Of this, 56,721 hectares were in the Kashmir region. Anantnag district cultivates walnut in 16,524 hectares, followed by Budgam with 14,524 hectares and Pulwama with 10,918 hectares. In the Jammu region, Poonch district has the largest area under walnut cultivation at 8,306 hectares, followed by Doda with 6,616 hectares.

In terms of productivity, Baramulla district in Kashmir records the highest yield at 44,98,863 tonnes per hectare, followed by Kulgam at 3,98,693 tonnes per hectare. In Jammu, Doda district leads with 16,63,525 tonnes per hectare, followed by Reasi at 16,47,861 tonnes per hectare.  

Under the Jammu and Kashmir Preservation of Specified Trees Act, 1969, a walnut tree can neither be felled nor pruned, even if it stands on private land, without permission from the revenue department. This special status is accorded mainly to protect the walnut economy, yet the dropping demand has made farmers cut down the trees with or without permission.

Environmental lawyer Nadeem Qadri emphasised that walnut trees are a cornerstone of the rural economy, yet development is wreaking havoc on the rural landscape and the cultural significance tied to these trees. He criticised officials for their lack of seriousness in conservation efforts, stating, “Officers are more eager to grant permissions for pruning or cutting trees rather than showing any real commitment to protecting these specific trees.”  

Wani suggested that the government should introduce support measures for walnut farmers, besides regulating imports.  

Kashmiri walnuts with a dark-hued shell displayed at Faisal Mir's Ganie Dryfruits in Delhi (Photo - Mohammad Aatif Ammad Kanth, 101Reporters).

GST woes, GI tag demand  

As if low-tariff imports were not enough, walnuts were placed under 12% tax slab during the Goods and Services Tax (GST) implementation in 2017. Following strong protests from growers, it was later reduced to 5%. However, many growers and traders remain dissatisfied, criticising the tax and demanding its complete removal.

“We ran from pillar to post urging them to reduce GST, but no one listened to us,” lamented Khan. They met horticulture department officials, government officials, local politicians and advisors of LG, but their pleas went unheard.

With increasing imports and intense competition, farmers and experts believe that securing a Geographical Indication (GI) tag is the only way to save the Kashmiri walnut industry. Similar to Kashmiri saffron, they argue that a GI tag for walnuts could restore their value.

Lone elaborated on the SKUAST-K’s efforts to bring GI tag to Kashmiri walnuts. “This will revive demand and serve as an effective marketing strategy. Right now, it is difficult for an average consumer to distinguish between hybrid and Kashmiri varieties,” he said.

Citing an example to show why GI tag mattered, Mir said that his customers who preferred imported walnut over Kashmiri ones, however often chose Kashmiri saffron over Iranian or Afghani saffron. “Even though these imported saffron might look more appealing, the GI tag on Kashmiri saffron boosted its demand,” he remarked.

Wani also emphasised the need for proper infrastructure to support the industry. “We still rely on manual labour to separate the kernel from the shell, but there are machines available to do this work in minutes, which otherwise takes days. Adopting such machines can significantly reduce production costs and boost farmers’ profits,” he said.  

He further highlighted the importance of grading machines, which sort walnuts based on size. “In Kashmir, we do not usually grade walnuts; instead, we mix them regardless of size. Grading machines can help filter and organise walnuts by size, making it easier to manage and market them effectively,” Wani added.  

However, farmers like Itoo believe that such machines are costly and can be afforded only if the government provides subsidies.

Mohammad Aatif Ammad Kanth is a Jammu and Kashmir-based freelance journalist and a member of 101Reporters, a pan-India network of grassroots reporters.