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Cashew exporters demand withdrawal of notification

MARCH 16, 2020

The Tamil Nadu Cashew Processors and Exporters Association wants a notification issued in February, making Minimum Import Price not applicable for units under Special Economic Zones and Export Oriented Units, to be withdrawn The Tamil Nadu Cashew Processors and Exporters Association has urged the Centre to implement Minimum Import Price (MIP) on cashew kernels used in the units coming under Special Economic Zones (SEZs) and Export Oriented Units (EOUs).

In a memorandum to the Prime Minister Narendra Modi, secretary of the Association, M. Ramakrishnan, said that the industry was on the path of revival when the Director General of Foreign Trade (DGFT) had issued a notification on February 14, 2020 making MIP not applicable for units under SEZ and EOU.

The notification has come as a bolt from the blue and all measures taken by the government to safeguard the cashew industry and farmers has now suffered a setback, he said.

“The Union Commerce Ministry had earlier sought the suggestions of the Cashew Export Promotion Council regarding the need for MIP to units under SEZ and EOU. The council had unanimously passed a resolution that MIP should be continued. However, the present notification is to support a single processor in SEZ,” the memorandum said.

Indian processed cashew kernels are of premium quality and enjoy a good brand image and premium prices in the international market. In addition, India is a major market for broken cashew kernels in the world and processing in other countries would be viable only if they could find a way to sell the broken kernels in India.

However, a section of traders have been resorting to unfair trade practices to cause severe imbalance in the industry in favour of a single processor in SEZ. The present notification will again pave the way for import of finished cashew kernels at less than half the cost price in India, Mr. Ramakrishnan said.

“Already the industry is reeling under severe problems due to closure of around 60 % of units coupled with mass retrenchment of workers. This has resulted in a huge financial crunch and many of the units have been declared as Non Performing Assets. The present notification will have far reaching consequences and create a huge burden on domestic manufacturers and farmers. The Government should immediately intervene and withdraw the notification in the interest of the cashew industry,” he added.

Source:https://www.thehindu.com/