July 24, 2019
Kochi: Cashew Export Promotion Council of India (CEPCI) has come up with a revival package for the industry and proposed short-term, medium-term and long-term strategies to be implemented by both state and central Governments. CEPCI has sought both monetary and non-monetary support and the proposed revival package expects support from the ministries of finance, commerce & industries, agriculture & farmer welfare, and labour, said CEPCI chairman RK Bhoodes.
India cashew processing - images by IT
CEPCI has highlighted the fact that the industry is spread across 17 states, with over 3,000 processing units generating direct employment for over 10 lakh workers and another 5 lakhs workers in farm and trade. However, the crisis has hit the industry badly.
“Over 60% of the factories, pan-India, are closed and the industry is almost on the verge of a total collapse. Financial crunch has resulted in rendering more than 7 lakhs workers jobless across the country. In Kerala alone, more than 700 factories of the 793 registered units remain closed for more than a year and 173 accounts declared NPA by the banks,” stated the revival plan.
Various factors that had caused the crisis include: International competition from Vietnam due to the low cost of processing; increase in wages by state governments beyond the bearing levels; slashing export incentives from 5% to 2 %; imposition of import duty at 5% in 2016 (which was later cut down to 2.5%) and surge in import of cashew kernels. According to Bhoodes, nationwide, over 250 units have defaulted on their bank loans.
However, to tide over these troubles, CEPCI has suggested various measures in the package. “We have suggested a complete withdrawal of import duty during our discussions with the Union government. Other suggestions include restructuring of NPA, soft loan for capital investments and working capital and policy decisions like increasing the minimum import price of cashew kernels,” said Bhoodes.
Other proposals in the revival plan include: Providing export incentives at 10% to ensure level; revision of reduced export incentives back to 5% with retrospective effect; disbursement of unpaid portion of grant-in-aid under 12th scheme plan; soft loan for mechanisation and automation in processing.
A industry seeks help
*Cashew industry is spread over 17 states, with over 3000 processing units
*It employs over 10L workers directly and another 5 lakhs workers in the farm and trade
*Due to the crisis, over 250 units have defaulted on their bank loans in India
*In Kerala alone, over 700 factories of the 793 registered units remain closed for more than a year
Shenoy Karun
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