The Hindu Business Line : Stalemate over setting up cashew development board

The Union Commerce Ministry's efforts for long to create a Cashew Development Board on almost similar to that lines of other commodities boards, such as for rubber, coir, coconut, coffee and tea etc, have reached a stalemate as the Ministries of Finance and Agriculture are said to be opposed have taken a hostile attitude towards its creation.

"It has been brought to a stalemate now. The Ministry of Finance says it has no money for the Board, while the Agriculture Ministry wants the cashew sector under the National Horticulture Mission (NHM)," Mr G.K. Pillai, Union Commerce Secretary, told Business Line, when contacted on Tuesday.

The Commerce Ministry is interested in setting up of the Board considering the importance of the crop, which is an input for the export processing industry, providing employment to around five lakh workers mostly women in the rural areas, he said.

The export earnings ranges between Rs 2,500 and Rs 2,800 crore a year. Given its importance as a major cash crop, with high potential for diversification and commercialisation, its development in a comprehensive manner is inevitable and, therefore, the Union Commerce Minister, Mr Kamal Nath, would be taking it up with the Prime Minister soon, he said.

"When the other crops/commodities can have Boards why can't cCashewto have one," he pointed out. Fully realising its importance, the Planning Commission has already approved the creation of a Cashew Development Board, Mr Pillai added.

Meanwhile, Mr A.K. Antony, Union Defence Minister, whose intervention has been sought by a delegation of trade union leaders recently in the matter, told Business Line that he would take it up with the concerned ministers concerned. However, he said, the issue should be jointly taken up by the MPs from the State in the next session of the Parliament.

The Union Commerce Ministry is said to have sent the draft proposal for setting up the Board to the Ministries of Agriculture and Finance for their comments before submitting it to the CCEA. The proposal covers all the aspects such as financial implications, establishment cost, annual cost, development schemes' implementation etc.

For self-sufficiency

Such a step was initiated after a Committee of Ministers had agreed in principle earlier to set up a Cashew Development Board aimed at achieving self-sufficiency in cashew production, taking research findings to the farmers' field, improving quality of products, processing, marketing and exports, official sources said.

In fact, creation of a Board is unlikely to entail any huge expenditure on the part of the Government, as it has been proposed to be created by merging the Cashew Development Directorate under the Union Ministry of Agriculture, Cashew Export Promotion Council and its technical division and Laboratory supported by the Commerce Ministry. At present, the Kochi-based Directorate with a mandate to implement certain schemes apart from monitoring the implementation of some of the schemes by State Governments is functioning with 50 per cent staff strength.

Funds allocation

The allocation to the NHM for horticultural crops in the 11th XIth Plan is Rs 61,500 crore. Since, it has a number of crops to be covered, separating of cashew from its fold to an independent Board was found to be essential in the interest of the crop, industry, workers and growers, official sources in the Agriculture Ministry told Business Line.

It is evident from the slow pace of progress achieved in cashew cultivation, even after spending hundreds of crores of rupees in several five-year Plans, that systematic cultivation using scientific methods is still lacking in this sector for want of proper co-ordination and extension services, a growers group said.

The situation has further aggravated ever since the mode of execution of schemes has changed, with Directorate of Cashew and Cocoa Development's (DCCD's role confined to design the development schemes. Financial allocations are made by the Centre, while implementation of the programmes is vested with the concerned sState Governments concerned.

"The many hierarchical channels through which all these activities have to take place invariably result in unwanted delays and making available the funds to the beneficiary or target groups becomes quite difficult." In several cases, almost half fifty per cent of the funds either remain unused unutilized or used for purposes other than for which it is allocated, they alleged.

The cashew growers are in several lakhs spread over many States., being small and marginal Cultivation is done in a very unorganizsed and unscientific manner. The farming practices and post-harvest technology are all very traditional and obsolete, the sources pointed out. Research findings are yet to percolate to fields and hardly any breakthrough could be achieved in product diversification, by-product utiliszation and value-addition, keeping the market realities in view, they said.

Considering all these factors the need was long felt and on similar lines of other commodity boards, way back from 1960s, they said. It is like some schemes are being chalked out and the funds disbursed to some State Governments, which often divert it for other purposes and to some State cashew corporations, with the result the small and medium growers are by and large deprived of the benefits, they alleged.

Given this situation, they said, department related Standing Parliamentary Committees on Commerce in their 42nd, 46th, 50th, 58th, 65th ,70th and 77th reports recommended formation of a Cashew Board. Others that who had made such recommendations are Department related Standing Parliamentary Committee on Agriculture; Raw nut Committee of Ministry of Commerce in 1960s; Indian Cashewnut Development Council (ICDC) during its functioning period from 1966 - 1986, in which, the Directorate of Cashew and Cocoa Development (DCCD) was functioning as its Secretariat.

Study report

Besides, the Indian Institute of Foreign Trade, in its study report on Indian Cashew Industry conducted as part of World Bank aided Multi-state Cashew Project (MSCP) during the period from 1981-86, also recommended the setting up of the Board. Another premier institute which had recommended its creation was the Indian Institute of Management, Calcutta, in its report on evaluation of cashew development programmes sponsored by the DCCD.

Despite all these recommendations and reports, formation of a unified agency for cashew so far remained a non-starter. "The escaping attitude so far expressed by certain Ministries in this matter under the pretext of economy in expenditure carry little weight in comparison to the revenue and employment this sector generates," they said.

The processing capacity of the Indian cashew industry, at present, is 1.2 million tonnes of raw nuts and almost 50 per cent of it is imported mainly from Africa. Vietnam was a major source for raw nuts, but with the setting up of processing units there not only supply has been stopped, but it has become a major competitor to of India in the world market.