Media Release

Mangaluru, Mar 4: Karnataka Cashew Manufacturers Association strongly protest the move by the Government of India to impose 5% basic customs duty on import of raw cashew nuts in the Union Budget 2016. The effective rate of duty is more than 9.5%, taking into consideration SAD and cess.

The budget places emphasis on employment generation and food processing. But, it is surprising that, age old employment generating food processing industry is being targeted by the government. The cashew industry in India processes more than 16 lac MT of raw cashew nut per anum. As the Indian crop is only 6 lac MT, they are forced to import balance requirement from overseas countries mainly from African countries.

Cashew industry is an ideal industry to portray 'Make In India' dream, as we import raw cashew, process it in India and export. Already African Governments are taking steps to develop their indigenous cashew processing sector and hence, industry is under tremendous competitive pressure. It is surprising that, 4% SAD is being levied on raw cashew imports and this is made refundable to a trader but not refundable to a manufacturer. In other words, the government is discouraging people who 'Make in India' and encourage traders who just import and sell to India.

Presently, the cashew industry employs more than 7 lac workers, mainly women from backward section of the society, in rural parts of India. With this new duty structure coming in, the cashew industry is all set to lose its competitiveness to countries like Vietnam and Africa. This may result in closure of many units and massive loss of employment opportunities.

Hence, The Karnataka Cashew Manufacturers Association demand for immediate rollback on the import duty levied on the cashew industry.