The cashew processors and exporters lead by the Cashew Export Promotion Council of India (CEPCI) have expressed concern at sharp surge in fraudulent import of cashew kernel in the country from the competing countries leading to almost closure of the domestic cashew industry.

“ The sharp surge in illegal imports of cashew kernels in India has added further woes to the already crisis hit cashew industry, large scale imports of low quality plain cashew kernels from competing countries  have literarily pushed cashew industry to the verge of a closure. If this practice is allowed to be continued, that would lead to the total collapse of the cashew industry in India.: said Dr R.K.Bhoodes, Chairman, The Cashew Export Promotion Council of India (CEPCI) in a press statement here today.

“ At present more than 50% of the cashew related  factories are closed down retrenching around Six Lakhs cashew workers on pan India basis due to these fraudulent imports by a section of traders in the industry. The Cashew Industry is spread over 17 states  of India that  earns forex worth Rs. 6,000 Cr to nation’s economy annually. Apart , Cashew  industry provides gainful employment to more than 10 Lakhs workers the vast majority of  whom are women folks  from the socially and economically backward section of society. The economy of many villages in Rural and suburban area   is dependent on the cashew Industry.” Said Dr Bhoodes.

“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/kg for broken grades and Rs 400/ Kg for wholes cashew is fixed and 45% of the same is levied as the basic customs duty for import of cashew kernels.  However under various Free Trade Agreements (FTA) roasted cashew kernels and that is further value added cashew products that comes under chapter 20 of the customs tariff is fully exempted from payment of basic customs duty.” Said Dr Bhoodes.

“ Several importers  Misusing the provisions import  large volumes of plain cashew kernels (mostly brokens) from competing countries like Vietnam, Mozambique, Ivory Coast etc. These countries have recently started processing and the products are inferior in quality compared to Indian products. Also, these countries don’t have a domestic market to sell their broken cashew kernels which is produced (25-35% by volume) in normal course of processing. Hence these countries are forced to sell their broken cashew kernels at throw away prices. Further some of the Indian processors have opened their processing units in these countries. They also push these low quality kernels into the Indian market in these fraudulent ways.” He added,

“These imports have adversely affected both the domestic and export markets of India. When such low quality and low priced broken kernels are dumped in 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. Further re-exporting of low quality wholes kernels of other countries with Indian labels has tarnished the brand of Indian kernels in the overseas market. Indian quality has almost lost its credibility in the international market.  Such exports of imported unpeeled cashew kernels also avails 5% export incentive as well as applicable to fully processed cashew in India. This is a big blow to the efforts of the CEPCI to promote “Indian cashew’ as a brand.” He said.

“The CEPCI delegation consisted of processors and exporters from Kerala, Tami Nadu, Karnataka, Goa, Maharashtra , Andhra Pradesh and Odisha have met with various government officials including Director (EP Agri Division), Joint Secretary, Director (ASEAN ), Additional DGFT and the PS to the Hon’ble Union Minister for Commerce and Industry an the he Member (Customs) of the Central Board of Indirect Taxes and Customs (CBIC) and the Chief Customs Commissioner. We have urged the government to use COFEPOSA or the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act to retain foreign currency and prevent smuggling” Dr Bhoodes added .

The other demands of industry include The import of cashew kernels into India (including the 12 categories of mis declarations) should be subject to 100% inspection by the customs for sampling and testing. Fraudulent importers should be blacklisted and COFEPOSA should be invoked against such repeated importers.