Coir Board chairman Christy Fernandez said the move is in view of the removal of coir from the list of restricted items of imports. As per the Export Import policy 1997-2002, the import of coir, fibre, yarn and products are not permitted except against a licence or in accordance with the public notice issued in this behalf. The public notice issued in August makes certain items freely importable into India from SAARC countries -- Bangladesh, Bhutan, Nepal, Maldives, Sri Lanka and Pakistan.

However, the items, including coir fibre, coir yarn and coir products, are importable into India under the condition that the they are new or in prime condition and originate from these countries. The matter was discussed in detail at a Coir Board meetingimmediately after the government notification came out. It was then decided that an appeal would be made to the centre to prevent free import of these items from SAARC countries.

With competition hotting up in the international coir market, it is feared that Indian products will face stiff challenge from Sri Lankan products which are of premium quality. However, a Coir Board official said it would not be profitable to import coir and coir-based items into India from the island country for the domestic market.

In the meantime, the Coir Board is going ahead with plans to streamline the Rs 213-crore industry and to make it profitable for the 3.61 lakh workers employed by it. A raw material bank is on the cards. It will function as a price stabilising agent and ensure surplus for export purposes. The board as already registered a company -- Coir Industries Support Services Company Limited -- for the purpose and it will be functional by the end of this year. The company will have an authorised capital of Rs 5crore with coir exporters, the state government and state government undertakings taking stakes in the project. The Coir Board will take 26 per cent of the equity in the venture.

The company will function as a raw materials supplier against the tendency to hoard industry raw materials like fibre, yarn, dyes, chemicals and jute twine. While freeing the coir industry from the problems created by middlemen, the new company will also ensure increased production, improved quality and correct time schedules for export items.