New Delhi–As a measure of support for India’s cashew industry, the government is working on eliminating the import duty on cashew kernel, Commerce Minister Suresh Prabhu said on Thursday.

Addressing the Kaju India 2019 global cashew buyer-seller meet organised by the Cashew Export Promotion Council of India (CEPCI), he also said that under the new National Agriculture Export Policy, the government has identified specific agriculture export zones and clusters that are well connected with ports and airports in the country.

“The government reduced customs duty to 2.5 per cent on cashew kernel and is now working on 0 per cent import duty.

“The new agriculture policy has been jointly prepared by the ministries of Commerce, Agriculture, and Food Processing. The Commerce Ministry will also set up a series of centres in states to help farmers and exporters to brand and sell products to international market,” he said.

According to CEPCI, India processes 17 lakh tonnes of raw cashew nuts per annum. Of this, around 9 lakh tonnes are imported, mainly from African countries.

Under pressure due to serious competition from from foreign competitors at home and abroad , the Indian cashew industry has sought government intervention to create a “level playing field” and revision of the minimum import price (MIP).

CEPCI Chairman R.K. Bhoodes said on Tuesday that in view of issues being faced by the sector, the Council has urged the government to revise the MIP for cashew kernels and allied products, as well as provide support to exporters.

“The surge in import of low quality finished and semi-finished cashew kernels using loops in the policy and also unfair methods is a serious threat to the cashew processors,” he said. These imports must be restricted for the survival of the industry, he added.

The situation has compelled cashew producers to seek an import duty hike on broken and whole cashew to 70 per cent from 45 per cent to bring it on par with the tariff for other category of nuts, he added.

According to Bhoodes, India is the world’s largest producer, processor and consumer of cashew. While 70 per cent of the produce is consumed in India, the rest is exported.

The CEPCI has also urged upward revision of MIP for cashew, which was set in 2013 at a much lower level than current market prices. “The lack of modernisation and high wages are making Indian exports uncompetitive as the cost of processing is lower in other exporting countries,” he said.

To deal with competition from Vietnam, Brazil and African countries, Indian producers are asking for export support. “We have asked the government to raise the support level of 5 per cent under the Merchandise Exports from India Scheme (MEIS) to 10 per cent,” Bhoodes said. (IANS)