THIRUVANANTHAPUFRAM:
The Cashew Export Promotion Council of India (CEPCI) has submitted to the central government a five-point remedial plan to reverse the alarming downward trend in cashew exports and help revive a once prosperous industry that provided employment to one million rural workers, mainly women.
In a press conference held at Mascot hotel on Thursday, a request has been made to Union Mini
Cashew exports from India declined by 40 percent as the export quantity dropped to 25,000 MT during April-August 2016 from 42,000 MT in the corresponding period last year.
The newly introduced import duty on the industry has hit the industry hard. As per the new provisions, duty free import is possible only if kernels weighing 25 per cent of the raw nuts imported and worth 15 per cent more in value are exported within 18 months. The present out-turn stands at a disheartening 12 to 18 per cent.
“Apart from the import duty burden, the slashing of export incentives have also led to the drastic fall in exports,” said CEPCI Chairman P. Sundaran. “While the present Trade Policy gives priority to industries, which are agriculture-based, labour-oriented, women-centric and export-oriented, the cashew industry which more than qualifies under all these categories, has been denied eligible benefits and subjected to a drastic cut in export incentives.”
In the five-point remedial measures outlined, besides withdrawal of the import duty in full, which adds up to 9.36 per cent including special additional duty and cess, the CEPCI has put forward a request to waive quantity norms on the Standard Input Output Norms retaining the prevailing value norms, with retrospective effect from March 1, 2016, because they feel that it is next to impossible to achieve a 25 percent out -turn target.
The CEPCI has also requested permission for processing raw nuts unhindered, in an exporter-friendly atmosphere, as well as trading of export quality grades of kernels, to enable exporters to fulfil their export commitments.
Import duty norms, imposed in March, stipulated that imported goods have to be processed in designated units, while disallowing movement of these goods from one unit to another.
As the industry sees it, the inherent nature of cashew processing makes this proposition difficult to accept. Unpredictable labour turnout too has made it difficult to schedule all stages of work in a single unit. CEPCI said in its petition to the central ministers that since cashew processing yields more than 15 grades of finished kernels, it has been a traditional practice among exporters to exchange grades of kernels to balance export orders.
The remedial measures sought include compliance checks, and action to be taken against a processor only if he fails to meet his export obligations within the allowed time period of 18 months.
The petition requests duty drawback credit at rates matching the total import duty chargeable on imports of raw nuts for those who export cashew kernels, processed from duty paid or domestic raw nuts.
CEPCI has also officially requested the Centre to give directives to banks for granting special economic packages for cashew industry during this crisis period. The suggestions regarding the special economic package made by CEPCI in a letter to the Prime Minister mainly emphasise on allowing time for cashew factories to repay the loans taken from banks in instalments.
Other suggestions put forward by CEPCI to the PM include providing special relaxations in non-performing asset rules to avoid classifying cashew industry loans as bad loans (NBA); restraining from moves to freeze/ take over the collateral property /stocks; converting the eroded working capital loan into term loans repayable over a long term period and allowing fresh low interest loans for raw nut procurement as also for automation and mechanisation of factories.
And finally, the CEPCI notes that the difficulties and delays in obtaining Advance Authorisation from many ports, even after complying with all procedural formalities.
The press meet was attended by M A Ansar , Vice Chairman ,CEPCI, Dr Bhoodesh , Member , Committee of Administration (CEPCI), K Sasi Varma, Advisor (CEPCI) and Sree Rajmohan, Joint Director (CEPCI) .
