It is estimated that the chlormequat chloride issue has cost the Indian grape industry around Rs2.5bn (US$53.27m), the Times of India reported.
Shipments of Indian grapes were stopped at European ports after traces of chlormequat, a grape sizing agent not prohibited in India, were found in them.
Because the EU had no specific regulations in place for the substance, the default level of 0.05mg per kg was applied, and when grapes were found with levels in excess of that amount, the Netherlands and Germany, both major markets for Indian grapes, refused to accept the fruit.
"The state exported 46,628 tonnes of grapes in 3,750 containers. The first 700 to 800 containers were accepted by the UK and Russia and received better prices," said Jagannath Khapare, chairman of the Grape Exporters Association (GEA).
"The remaining grapes were sold at an average price of €4 (US$5.20) per kg. The importers chose to sell grapes at such lower prices to control the damage."
Mr Khapare said grape exporters from Maharashtra, India's premier grape growing state, had lodged claims for government compensation at both state and national level.
India's table grape exports were worth around US$79.56m in 2008/09, up from US$48.28m in 2005/06.
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