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  • Foreign trade policy blow to cashew exporters

    Apr 3rd, 2015

    Cashew exporters view the new Foreign Trade Policy as a major blow to the industry. They feel the reduction of incentives available to cashew exports under Chapter 3 of the Foreign Trade Policy from 5 per cent to 2 per cent as the main reason for this.Walter D’Souza, former president of the Cashew Export Promotion Council of India, has said that scaling down of Chapter 3 benefits such as Vishesh Krishi Grameen Upaj Yojana (VKGUY) by 3 per cent under the new name of Merchandise Export from India Scheme (MEIS) will have far reaching repercussions on exports. Advantage Vietnam K Prakash Rao of Kalbavi Cashews (an exporter from Mangaluru), said India has already lost the world’s largest cashew exporter tag to Vietnam.Vietnam gained advantage from cheap labour and a jump in its raw cashew production.Vietnam’s national average productivity of raw cashew nut is 2.1 tonnes a hectare against some 0.78 tonnes a hectare in India.However, India had stayed put in global market because of the VKGUY benefit of 5 percent.“Markets are so competitive that every exporter in India factors this 5 per cent in his sale price and sells in the overseas market,” he said.D’Souza said that the scaling down of the VKGUY benefit had come into effect from April 1. It is imperative that the earlier incentives are restored or at least continued until June 30, he said.