Revival package for Kerala's cashew processing industry on the anvil

The crisis-ridden cashew processing industry in Kerala is expecting a special revival package from the state government. 

The industry is reeling under the burden of mounting non-performing assets (NPAs), owing to higher wages, trade union issues and shortage of local raw cashew.

Kerala chief minister will be meeting trade union representatives and bankers before announcing the package. 

Industry representatives already had a meeting with the chief minister earlier this month and had told the state to change the wage structure and attach performance conditions to it. Some of the banks have resumed giving loans to the industry, which helped some factories to restart. The units had stopped functioning following the workers unscheduled strike.

“The chief minister is expected to meet trade union leaders and bank representatives. We are expecting some positive decision to come out from these meetings and the industry will be able to restart production as it was doing earlier,” said I Nizamuddin, secretary of the Federation of Cashew Processors and Exporters, Kerala.

Almost 90 per cent of the over 865 factories in the state had closed down and around 250,000 of the total 300,000 workers went jobless as higher wages and increasing NPAs affected the operations of these units, which were processing almost 85 per cent of the country’s cashews a decade ago.

The state government said it has helped over 170 private companies to restart operations in the recent past, through talks with various banks. The government is holding high-level meetings with banks and financial agencies to finance private sector processors.

“So far, the revival package for 176 private factories has been submitted and efforts are on to reopen the factories and ensure employment to the workers by restructuring bank loans,” J Mercykutty Amma, state minister for fisheries, harbour engineering and cashew industry had said in the Legislative Assembly. The government had declared moratorium on debts till May 31, 2018.

The government is also taking steps to import raw cashewnut from African countries directly and formed a Cashew Board to find alternatives for getting adequate raw cashew for the units in the state.