India’ role in the Agarwood trade

India was previously the centre of a thriving industry and trade based on agarwood. Products produced and traded included wood, chips, powder and oil, being used mainly for perfumes, incense, and medicines (including Ayurvedic). Prior to the 1991 export ban on wood and wood products, Mumbai served as the main exporting centre to Middle Eastern countries. Agarwood harvested from north-east Indian States, predominantly Assam, was taken to Hojai in Assam where it was processed into chips, dust and oil. Importers and exporters previously supplied traders in Mumbai and Calcutta, primarily with Assamese agarwood, but suppliers have largely shifted their base to south-east Asian countries, particularly Singapore, owing to the scarcity of Indian agarwood.

Traders interviewed reported that the decline in the trade started 15-20 years ago, coinciding with the decline in the availability of high quality Indian agarwood. Even with the decline in trade, however, there is still an agarwood chip, oil and powder processing industry in India. North-east India continues to dominate India’s agarwood processing industry, with Assam and particularly Hojai still playing a major role, and Mumbai being the main location from which agarwood is traded and exported.

According to Heuveling van Beek and Phillips (1999), Indian importers buy many tonnes of low grade agarwood powder for distillation purposes. Many large processing units are located in Assam, Chakrabarty et al.(1994) reporting that a total of approximately 200 agarwood oil distilleries operated in the towns of Hojai, Islamanagar and Nilbagan in Naogaon district in 1993. The number of distilleries in current operation is unknown, but interviews conducted suggested that there are currently far more processing units in Assam than in 1993. Unconfirmed local enquiries suggest that there may be more than 1500 processing units in Hojai alone, although, according to available information, the Industry Department has issued licences to only 29 (unlicensed processing units are presumably operating illegally).

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