Cashew is considered as one of the vital sources of nutrients which high calories and protein content, making it the most demanded form of natural supplements in the world. With such a demand, India plays an important role in supplying cashew to major countries in the world. Though the Cashew Exports are doing a tremendous job creation and giving employment to over millions of people, there are several setbacks and issues which the Indian Cashew Export has faced during recent years such as the imposition of import duties, high production cost, GST issues, to name a few.
The international market for the cashew seems to be easy access to cater to the needs of cashew to every country in the world due to the presence of easy availability of raw materials and cheap labour. Following the major changes in the taxation policies and subsidies, the Indian Cashew Exports are under reforms, and the Mission 2020 will help a large majority of small-scale cashew providers to generate good incomes with better facility.
The cashew industry and the allied products of cashew is promoted by The Cashew Export Promotion Council of India, termed as CEPCI.
Being one of the oldest industries, the cashew industry is run by cottage sectors. India is one of the largest producers of raw cashew nut with the production capacity of 7.8 lakh metric tonnes, and also the largest consumer of cashew in the world. As per the global reports, the Cashew Exports in the year 2016-2017 was US$ 771, which account for the 22% of the Indian Cashew Exports with Vietnam as the major exporter of cashew kernels in the world.
The cashew industry, being an important sector in terms of GDP, it is cultivated in more than 17 states of India which makes easy availability of raw cashew ready for exports as well as to cater the growing demands of cashew and cashew kernels for the Indian population. Above all, the Cashew Exports accounts for a 25% share in the world.
Also, when it comes to the export of roasted and salted cashew kernels, it saw a major decline in its exports as in 2016-2017, it was Rs 440 million which has come to Rs 326.3 million with the export of 11,422 metric tonnes.
Reasons for the Decline of Cashew Exports:
Various factors and issues were the reason behind the sudden downfall of the Indian cashew in the international and national market, which is also a major concern. The challenges revolving around the cashew industries run by small scale or cottage industry in nearly 17 states of India are discussed below:
1. Import Duty on Cashew and its Allied Products
The imposition of the 5% basic customs duty on the cashew has made an adverse effect of the purchase of raw materials which are used in the processing of cashew and its allied products. The industry, which was giving employment to over 1 million people, has seen a sudden decline in its production with the closure of more than 50% production units followed by other big losses.
2. High Production Cost
Lack of modern machinery and the high cost of labour means higher production cost, including the overhead cost, which is another reason for the adverse conditions a cashew industry is facing.
3. SION Issues
The SION norms for the cashew suppliers for the export grades, which was 1:6 has been revised to 1:5.04 for the Cashew Exports is not practically possible for the small-scale industries which play a major role in the cashew processing in the Indian market.
4. GST Issues, a major concern
One cannot deny the fact that the sudden implementation of the GST has made the worst impact on the Indian economy and a major loss for the small, medium and large-scale industries. These include blockage of funds, high GST for the job works. Non-refund of GST paid on the exports, to name a few. A crisp and clear GST solution for all is needed to gain major achievement in the cashew export business.
Vietnam, being the largest supplier of cashew and cashew kernels in the world gains easy access to increase its production due to the lack of facilities in the Indian Cashew Exports, which is a setback to Indian economy on an international level.
Ways to Improve the Structure of the Indian Cashew Export and the Mission 2020:
To regain the cashew market and bounce back with more fruitful results in the Cashew Exports, solid plans, and technology enhancement is an easier way to generate more income opportunities among small, medium or cottage industry workers. Mission 2020 is about to reach new heights for the growth of the cashew and the exports of its allied products on an international level with more profits as compared to previous years.
Plans to Achieve the Mission 2020 Target:
- Promoting the Indian Cashew brand in the international market.
- Modernisation and better automation to achieve better production.
- The Cashew Exports is expected to increase over 1.20 lakh metric tonnes.
- We are providing over 200 million-man days of employment in the organised sector of the cashew processing units.
- And the major plans to enhance the growth of cashew by establishing various Export Facilitation Centers and Regional Offices of CEPCI.
The mission 2020 of the cashew exports is all about to make a better impact in the world of cashew exports by providing the best quality of salted and roasted cashews catering the needs of people in the world. It will not only help to generate more profits but also help India to become the world’s largest exporter of top-quality cashew kernels.
The Mission 2020 of the Indian Cashew Exports is possible, and sudden recommendation is needed to be implemented from the export council to help facilitate the proper and the easy availability of modernised process and automation to foster the growth. Also, withdrawing of the 5% basic customs duty will make the availability of raw materials easily.
If you are looking forward to starting your cashew export business in India, contact +91 9211066888, we will help you start your import export business from scratch.