Lok Sabha Question No. 2225 (UNSTARRED), answered on 2018-12-24
Subject: Cashew Industry
Ministry: COMMERCE AND INDUSTRY
Asked by: N.K. PREMACHANDRAN

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO. 2225 TO BE ANSWERED ON 24 th  DECEMBER,2018

## CASHEW INDUSTRY

## 2225. SHRI N.K. PREMACHANDRAN:

Will the Minister of COMMERCE & INDUSTRY ( वा ͨणÏय एवं उɮयोग मंğी ) be pleased to state:

- (a) whether it has come to the notice of the Government that cashew industry in Kerala is in crisis and if so, the action taken by the Government to overcome the crisis;
- (b) whether it has come to the notice of the Government that the action initiated by the banks for recovery of loans make the issue critical;
- (c) if so, the action taken by the Government for revival and restructuring the loans of cashew industry;
- (d) whether the Government has initiated action for opening the cashew factories closed due to the crisis and if so, the details of action taken in this regard;
- (e) whether the Government proposes to formulate a scheme for providing raw cashew nuts to the industry at a reasonable price and if so, the details thereof; and
- (f) whether  the  Government  proposes  to  establish  a  comprehensive  project  for  the revival of cashew industry and if so, the details thereof?

## ANSWER

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THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI C. R. CHAUDHARY)

- (a) Cashew Industry in India has seen a positive growth in the production of raw cashew nuts and export of cashew kernnel. Production of Raw Cashew nut during 2017-18  has  registered  4.83  %  increase  to  8,17,045  Metric  Tons  as  compared  to production of 7,79,335 Metric Tons during 2016-17 and 21.89% increase compared to  the  production  of  6,70,300  Metric  Tons  during  2015-16  .    Similarly,  the  export earnings from cashew and allied products during the year 2017-18  has reached at Rs.5903.60 crore (USD 916 million) registering a growth of 13.25% (in rupees terms) over the last year export of Rs.5,212.78 crores (US$ 778 Million).

However, the Government has taken several steps to address the problems faced by some section in cashew industry

-  Basic Custom Duty on import of raw  cashew nut has been reduced  from 5% to 2.5% we.f 01.02.2018 in the current budget session.
-  Goods and Service Tax (GST) has been reduced to 5% from 12% for Cashew nuts.
-  Under Mid Term Review of Foreign Trade Policy (FTP), Merchandise Export Incentive  Scheme  (MEIS)  for  cashew  was  increased  to  5%  (from  3%)  for cashew kernel and 7% (from 5%) for cashew nut salted/roasted respectively.
-  Revised Standard Inputs Output Norms (SION) norms for export of Cashew Kernel,  from  import  of   Raw  Cashew  Nut  under  Advance  Authorisation Scheme, to 5.04 kg  from 4 kg.
-  Approved  the  Medium  Term  Framework  (2017-2020)  Scheme  for   Process Mechanization  and  Automation  of  Cashew  Processing  Units  with  financial outlay of Rs. 60 crore.

(b) & (c)  For revival of stressed unit, timely restructuring of accounts can be done as per Banks Policy and RBI guidelines.  To preserve the economic value of units, restructuring is done by modifying the terms & conditions of the loan on the basis of mutual agreement between the lenders & the borrowers. Hence, there is no action due on Government with regard to restructuring of loans.

(d) Closure  of  factories  can  be  attributed  to  a  variety  of  factors  like  increased wage cost, default in repayment of loans, lack of proper management, domestic & international demand-supply situation, etc. The Department of Commerce does not have any scheme for re-opening of closed industries.

(e) In  order  to  make  available  the  required  raw  cashewnuts  for  the  industry, under  Mission  for  Integrated  Development  of  Horticulture  (MIDH)  and  Rashtriya Krishi Vikash Yojana (RKVY), Ministry of Agriculture and Farmer's Welfare (MoAFW) has drawn up strategies to increase domestic production by massive area expansion of cashew and replacing of senile cashew  plantations with high yielding varieties in traditional and non-traditional states. Some of the key initiatives are New plantation Development programme, replanting programme of cashew, technology dissemination  and  transfer  of  technology  programme  etc.  Efforts  made  by  the Government  has  produced  significant  growth  in  production  of  raw  cashew  nut  as mentioned in para (a) above.

- (f) The Government has no such proposal at present.

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