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  • Cashew exporters hit by IGST refund delay

    Sep 22nd, 2017

    Cashew exporters have once again sought withdrawal of duty on import of raw cashew, pushed by the delay in refund of integrated general sales tax (IGST) on imports which has hit their working capital and operations.The shortage in working capital comes at a time when exporters are seeing a jump in demand for cashew kernel. India meets over half of its raw cashew requirement for processing and export from overseas.

    Since July, exporters have been paying 5% IGST in addition to the 5% duty charged on raw cashew arriving from countries like Ivory Coast and Ghana, which account for the bulk of shipments to India, but have not received IGST refund even after completing exports.“We have to pay around Rs 40 lakh as IGST for taking 500 tons of imported raw cashew for export. Those who have completed export haven’t got the refund, which has affected our operations,’’ said P Somarajan, proprietor of Kailas Cashew Exports.

    Exporters took their request to Commerce Minister Suresh Prabhu, who attended Kaju India, the global cashew meet that concluded at Goa this week. “He has promised us that he will consider it along with our demand for raising the export incentive for cashew from 3% to 5%,” said P Sundaran, chairman of Cashew Export Promotion Council of India (CEPCI).Cashew exports from India are seeing a rise after a decline in the last couple of years. The export value too is rising with cashew kernels fetching good prices.

    As per CEPCI data, cashew exports in the April-July period increased by 25% from a year ago to 31,172 tons. In value terms it increased by 50% to Rs 2,141 crore. “The export prices are averaging at $5.10 per pound, which is almost break-even given the average raw cashew price of $2000 per ton,’’ said K Prakash Rao, managing partner of Kalbavi Cashews.Good times are in store for domestic sellers too. Pre-Diwali sales have lifted the domestic price of the commodity, which had turned sluggish after the government’s demonetisation drive. “From Rs 780 per kg, prices have risen to Rs 840 per kg. A further increase in possible in the coming days till Diwali,’’ Rao said.India is currently the largest cashew consumer at 3 lakh tons.


    Source: http://economictimes.indiatimes.com/