According to Nayar, cashew is grown in about 1,20,000 hectares in Kerala apart from over 6000 hectares owned by Plantation Corporation of Kerala and around 4400 hectares owned by the Kerala State Forest Department. The rest of the cashew comes from homestead gardens of less than two hectares, mostly marginal land belonging to the rural poor. And this accounts for nearly 28 per cent of the total production of the country.

The export target drawn up by CEPC for the current year is 80,000 tonnes with an aim to earn $433 million in 1998-99 against $374 million in 1997-98.

Indian cashew commands a 65 per cent share of the world market and is known for its quality, said Nayar. There is a global scarcity for the commodity, he said. Inspite of such a global status the government's approach towards its promotion lacks vision.

It can be cultivated on waste land in coastal areas. The development schemes have had no results as growers are hesitant to take it. They argue that it is not a viable project because large scale cultivation is not possible as land ceiling laws do not permit it. Moreover, the price of raw cashew should average at least Rs 35 a kg to be more or equally profitable compared to other plantation crops.

Nayar said that availability of raw cashews for processing in 1997-98 was only six lakh tonnes. About two lakh raw nuts had to be imported to marginally fill in the capacity of the processing units in the country. The processing units in the country together constitute a capacity of 8 lakh tonnes per annum but the domestic production was less than 4 lakh tonnes.

During 1997-98, India had imported 2.24 lakh tonnes of raw cashewnut resulting in a forex outflow of Rs 744 crore. Processed cashew export in the same periodhad brought in Rs 1,383.9 crore, with an additional Rs 6.74 crore from cashewnut shell liquid export.

The area under cultivation has increased from 6,59,000 hectares in 1996-97 from 7,00,900 hectares in 1997-98, but the production has dropped from 4.3 lakh tonnes in 1996-97 to 3.6 lakh tonnes in 1997-98.

The world production of raw cashewnuts is estimated at 9.50 lakh tonnes, of which India's contribution is around 3.8 lakh tonnes. The major competition comes from Brazil, which accounts for about two lakh tonnes. Other major cashewnut producing countries are Vietnam, Tanzania, Mozambique and Indonesia.

According to Nayar, the cashew industry is always in a state of concern over the availability of raw nuts for processing. The exporters, the processors and the workers are in a constant state of uncertainty about the getting enough work and orders throughout the year.

He said the availability of processed cashew kernal is approximately the one-fourth of the raw cashewnut. In 1997-98, about 76,323 tonneswere exported -- which was about 50 per cent of the total processed kernal, while the other half went into domestic consumption.

Another detrimental factor for cashew exports is the purchase tax levied by the state governments. Only Maharashtra has no purchase tax. Andhra Pradesh imposes a 10 per cent tax while Tamil Nadu and Kerala levy eight per cent and 7.7 per cent respectively.

CEPC's promotion schemes include modernisation, quality improvement and packaging improvement programmes for which the council provides subsidy for the exporter.

CEPC is attempting a major export drive by diversifying the market. At present the US and western Europe are the major buyers, taking away 80 per cent of the global output. The council is trying to create a market elsewhere in Australia, Japan and the West Asia. Another strategy is for exporting more of value-added products. Current export is constituted of 99.5 per cent of bulk packs and only 0.5 per cent is value added. Of Rs 1,383 crore of export value, only Rs 1crore is worth value-added.