Year: 2015 | Month: June | Volume 60 | Issue 2
Stability Analysis of Indian Spices Export – A Markov Chain Approach
Spices are an important horticultural crop of India as it adds substantially to the agriculture GDP. It has been seen that there is high fluctuations in the export of spices to other countries. To, this end, we employ the concept of Markov chain (MC) to analyze the dynamics of spices export to different countries of the world. It was observed that the countries which were stable destination for Indian spices export were Canada for black pepper, UK for chilli, Bangladesh for turmeric, UAE for cumin and Malaysia for coriander. The transitional probability matrix obtained using MC indicated that most of the traditional importers have shown low retention probability which may be due to tough competition arising in spices trade and trade related barriers in the developed nations. So, policies may be framed by planners for export towards these countries. Though in most of the spices, India has managed to retain one of its original markets, but it should not have high dependency on one market alone to avoid trade risk in the long-run. New markets also need to be explored and more stress has to be given to the traditional buyers for maintaining present status of export and market share in future.
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