India produces 6-7 million tonne raw cashew per annum, and was till recently the leading supplier of kernels to the global markets.
Cashew processors and exporters have expressed concern over the sharp surge in fraudulent imports of cashew kernels into the country from competing countries leading to a crisis in the domestic industry. India produces 6-7 million tonne raw cashew per annum, and was till recently the leading supplier of kernels to the global markets.
“The surge in illegal imports of cashew kernels in India has added to the woes of the crisis-hit cashew industry. Large-scale imports of low-quality kernels from competing countries have literally pushed the industry to the verge of a closure. If this practice is allowed to continue, it would lead to the total collapse of the cashew industry in India,” Dr RK Bhoodes, chairman of the Cashew Export Promotion Council of India (CEPCI) said in a press statement on Wednesday. “Plain cashew kernels that falls under chapter 8 of the customs tariff is levied a basic customs duty of 45% . Also minimum import price of Rs 288 per kg for broken grades and Rs 400 per kg for whole cashew is fixed, and 45% of the same is levied as the basic customs duty for import of kernels. However, under various free trade agreements (FTAs) roasted cashew kernels, a value-added cashew product,comes under chapter 20 of the customs tariff. It is fully exempted from payment of basic customs duty,” CEPCI sources said.
“Several markets, misusing the provisions, are importing large volumes of mostly broken kernels from competing countries like Vietnam, Mozambique, Ivory Coast etc. These countries have recently started processing and the products are inferior in quality compared to the Indian varieties. Also, these countries don’t have a domestic market to sell their broken cashew kernels, produced (25-35% by volume) in normal course of processing. Further, some of the Indian processors have opened their processing units in these countries, and are pushing these low-quality kernels into the Indian market through these fraudulent ways,” he added.
“At present, more than 50% of the cashew-related factories in the country are closed down, affecting around 6 lakh cashew workers across India. The cashew industry is spread over 17 Indian states, and earns forex worth Rs 6,000 crore annually. The industry provides gainful employment to more than 10 lakh workers, majority of them being women from the socially and economically backward sections of the society,” Bhoodes added.
“These imports have adversely affected both domestic and export markets. When such low-quality and low-priced, broken kernels are dumped into Indian domestic market evading customs duty , genuine processors in India find it extremely difficult to sell their products and the domestic market prices have declined to such a low level that domestic processing is unviable in India, ” he added.