Private sector processors have welcomed the allocation of Rs. 20 crore in the State budget for cashew industry.
The allocation is for programmes aimed at arresting the migration of cashew processing units to neighbouring States.
Cashew Development Corporation Chairman S. Jayamohan said a decision on the programmes would be taken after talks between the government, trade unions, and private sector processors.
Kerala, which once enjoyed global monopoly in cashew processing, now faces the threat of losing private players in the sector. Thanks to a steep increase in the cost of production and the alleged trade union militancy, a good section of private sector cashew processors have shifted operations to neighbouring States where the cost of production is comparatively low.
The migration had been steadily on for the past several years as private processors feel that successive governments had been blindly backing trade union diktats based on vote bank politics without taking into consideration the issues facing the industry.
Revision of wages
The situation took a serious turn following the revision of minimum wages for cashew workers in 2015. This led to over 80% of the remaining units getting closed down on the grounds that the revision had pushed up the cost of production, making products from Kerala highly uncompetitive in both domestic and international cashew kernel markets.
Though private processors are not in a hurry to comment on the allocation for the sector, they feel it is an indication of the government’s willingness to take them also into confidence in the larger interest of protecting the industry.