THIRUVANANTHAPURAM, Nov 13: Two multi-crore export-oriented projects of Kerala Kera Karshaka Sahakarana Federation (Kerafed) have been stymied, with the European Union (EU) office in New Delhi allegedly sitting pretty over the funding dossier. After the recent turnaround, the federation had been knocking doors at EU for the sanction of the promised Rs 40 crore funds for expansion. A meeting of the officials of EU and National Cooperative Development Council (NCDC) in New Delhi last week which evaluated the performance of the federation, set up in 1992, deferred decision on releasing the funds to January, 1998. EU officials were yet to complete the study on the expansion project proposals and requests for funds, sources told The Financial Express the other day.

Kerafed, has on its anvil, two export-oriented forward integration projects -- Rs 11-cr desiccated coconut project in Kozhikode and a Rs 23-cr activated carbon plant in Kochi. The project proposals have been forwarded to EU through the NCDC, via the state government channels. This took only six months. Of about Rs 93 crore assistance package earmarked for Kerala in 1988, only Rs 53 crore has been released so far. Of this Rs 25 crore was soft loan and Rs 18 crore was in the form of subsidy for agricultural extension. The rest was share capital assistance from NCDC and the State government.

However, Kerafed managing director K Elangovan has no apprehensions. He is optimistic about the release of funds. "The EU brass had expressed satisfaction about the Kerafed's recent reversal of packing formula for its coconut oil and the resultant effect on its balance sheets.

There was also a general consensus on the viability of the projects," he said.The federation's balance sheets had, in 1996-97, turned rosy with a first time net profit of Rs 2.47 crore. "A radical shuffle in the retailing formula had also left a growth trajectory for Kerafed. It only remained to consolidate the market gains through the right expansion projects," Elangovan said. However, both the proposed projects of the federation do appear rather ambitious for a firm recently out of the red and saddled by dithering decision-making bodies at various levels.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.