For deepening the trade partnership between India and Africa, the Kerala government and top diplomats from African countries met last week to ensure level-playing field for raw cashew cultivation and cashew nut processing industry on both sides. At a recently concluded two-day Cashew Nut conclave organised by the MEA, Kerala has requested the Economic Diplomacy Division of the MEA to direct Indian missions to liaise with the concerned ministers and organisations to facilitate direct procurement of cashew nuts from the African countries. According to MEA, “The state government has requested the MEA to help evolve a plan of action to enter into a letter of intent (LoI), or MoU, with the African nations to source raw cashew nuts, negotiate prices and to ensure more work days to around three-lakh labourers in cashew factories in Kerala so as to have a win-win agreement.”
Kerala chief minister Pinarayi Vijayan, while addressing the top diplomats from the African countries, had stressed on the need of avoiding middlemen in the cashew industry and urged the MEA to help an agency identified by the state government to inspect the stock and lift raw cashew nuts.
Sources told FE, “One of the main challenges the cashew nut sector faces is the mismatch between demand and supply on its requirement of around 7 lakh million tonne of raw cashew in a year. Faced with a requirement of 8 lakh tonne of raw cashew nuts a year, only 0.83 lakh tonne is being produced in the state. The rest has to be imported.”
The idea of having a common Kerala-Africa brand, jointly owned by Kerala and cashew-growing African nations, for cashew products to move together in the value chain was also mooted. Both Africa and Kerala are keen on exploring the possibility of technological collaboration, which would help in increasing the productivity in African countries. “Both sides have decided to explore the best value-chain results for all stakeholders in the cashew industry – producers, farmers and sellers (co-operatives and boards) in Africa, and buyers (the state of Kerala), processors and consumers,” said the MEA officials.
It was agreed that a detailed proposal will be prepared by the state government on the price agreement and transportation of raw nuts. Then it will be submitted to the external affairs ministry which will discuss with Kerala and the African nations to take it forward. Diplomats from Africa are keen on having a proper mechanism in which there can be a direct buyer and seller relation between India (Kerala) and African nations in cashew economy.