Kerala to bear 50% interest on capital loans by cashew cos: Minister Rajeev

The Kerala government on Wednesday decided to bear a portion of the PF and ESI payments of the private cashew companies in an effort to revive the crisis-hit industry in the southern state.

State Industries Minister P Rajeev while launching eight new value-added cashew products by the Kerala State Cashew Development Corporation (KSCDC) for the Onam market here, said the government has also decided to bear 50 per cent of the loan interest burden of these factories and has reached a settlement with the banks to write off all interest and compound interest on Non-Performing Assets of cashew factories.

"Now the government has intervened with the banks, and the banks are now ready to write off the penal interest and the accumulated interest, and they are ready to settle these NPAs by settling 50 per cent of the amount of the loan up to Rs 2 crore and 60 per cent of the principal amount up to Rs 10 crore," Rajeev told PTI.

He said the Kerala cashews produced by the KSCDC and Kerala State Cashew Workers Apex Industrial Co-Operative Society Limited (CAPEX) are among the best in the world, as these cashews are still produced under the conventional method and are the most sought after.

The raw nuts produced in areas like Aralam and Iritty in the Kannur district, known as 'Jumbo', are the biggest nuts available in the market.

State Finance Minister K N Balagopal, who was present at the function, said the cashew sector has been one of the main employers in Kerala, with a majority of the workforce being women.

He said the government has solved almost all labour issues in these sectors, providing a major boost to the industry.

Apart from 30 factories of KSCDC and 10 belonging to CAPEX, there were more than 700 cashew factories in the private sector in Kerala, out of which only 200 or so are now functioning.

Though the market demand is very high, Kerala does not produce enough to meet the demand.

"We are now importing cashew mainly from African countries. Cashew factories in other states in India, like Maharashtra, Karnataka, and Tamil Nadu, are also depending on imported cashews from African countries," Sunil John K, materials manager, KSCDC, told PTI.

He said the cashew production in Kerala has come down over the years.

"The best cashews are available in Kannur and Kasaragod districts, and there is a huge competition to get them," he added.

According to sources, the cashew factory lobby in Mangaluru in Karnataka takes the farms in Kannur and Kasaragod well in advance and secures the produce due to the high demand for this high-quality cashew.

Now the Kerala government is promoting cashew cultivation by providing free grafted saplings to the farmers, and those who are cultivating above two hectares are paid Rs 60 per sapling after three months.

"These grafted saplings start producing nuts from three years onward," Sunil said.

At present, the Kerala government is procuring raw nuts from the farmers at Rs 114 per kilogramme, which is more than the market price, Sunil said.

Earlier, the KSCDC introduced eight new value-added products for the Onam market and will be selling them with a 30 per cent discount.

The new products launched are Cashew Vita Pista, Cashew Vita Cardamom, Cashew Vita Vanilla, Cashew Vita Chocolate, Cashew Vanilla Milk Shake, and flavoured cashew products like chilli-garlic coated cashew nuts, salt and pepper cashew nuts, red chilli coated cashew nuts, cashew soup, cashew powder, cashew soda made out of cashew apple pulp, cashew apple squash, and cashew pine jam.

The KSCDC won an award for bringing out the maximum number of value-added products from cashew in 2018 and 2019 consecutively from the Central Government in the Cashew Conclave. This award was stopped due to COVID and is yet to be reinstated.