Before you think this is just a bit of budgetary horsing around and isn’t a big deal commercially, consider this: The industry around thoroughbreds is worth half a trillion dollars globally, and potential winnings for India for betting on free trade are big. A prized equine can fetch as much as a million dollars in the world market.
The National Horse Breeding Society of India had sought the duty relief. Tegbir Brar, owner of Dashmesh Stud farm, said currently customs duty, GST and cess add up to 48.96%. “Now we’ll be able to import better stock to improve breeds.”
“This is a very positive move… India has been missing out on this for years,” said Satish Seemar, who was instrumental in putting Dubai on the global horse racing map, and is the first UAE-based trainer to win a race in Europe.
“Indian horse breeders will be able to invest in higher-quality breeding stock,” said Anil Mukhi, who runs Galaxy Bloodstock Services. India imports 50-60 thoroughbred horses annually. The number could now rise to 200, breeders said, adding that export potential will rise. Currently, only Sri Lanka imports a few horses from India.
Mukhi said India can export thoroughbreds to Singapore, Malaysia, Macau and Hong Kong — all markets currently supplied by breeders from Australia and New Zealand. The Middle East is another big market. India can also offer rest and recuperation facilities for racing horses from the Middle East.
Breeders cite the example of Irish vendors to make the case for duty-free thoroughbreds. Ireland sells horses worth €250 million in the global market. There’s also a big foreign investment potential. Breeders said India could attract investments from Ireland, the US and Canada for joint ventures.
Mukhi estimates the initial investment on only pure-bred horses in a new breeding venture will be of the order of $3 million (about Rs 21 crore at current exchange rates) apart from investments in land and manpower by Indian partners.
The benefits of free trade in thoroughbreds will trot down the economic ladder. Ravi Reddy, president of Nanoli Stud in Pune, said the sector currently employs 3-3.5 million people, directly and indirectly. And the budget’s move will likely increase employment “substantially”. Seemar said revival of thoroughbred trade will also help farmers who grow fodder, and create ancillary jobs in the rural economy. Other likely gainers include the specialised business of transporting horses, veterinary doctors and accessories businesses such as saddlemaking, as well as airlines.
No better example of a bit of horse sense when it comes to tariff setting.