As a corollary, the board has also suggested the development of upstream and downstream industries. The domestic producers can successfully ward of the import threats and can even emerge as a major exporter.

In its suggestion on minimum support price to be submitted to the Commission for Agricultural Cost and Pricing, the Board has said that in order to take on the possibility of import competition the domestic coconut products are to be made cost effective and and should stick to international quality parameters.

While the coconut oil in the international market is used mainly for industrial purpose, the domestic demand for the commodity comes mainly from edible and toiletry purposes. The Board is of the view that the coconut oil can fetch a premium over its competitors in the international market for its aroma, flavour andquality.

"If the domestic price of coconut oil is stabilised within a reasonable range there can be no challenge to the industry", the report said.

According to the Board's view, the price of the coconut oil could be stabilised if the total availability of the oil could be maintained at optimum level.

Steps should be taken to encourage diversification of the industry to other sectors, especially new industries based on coconut and its by products, the report said.

The industry should be encouraged to move away from its excessive dependence on coconut oil and a sizeable amount of the nuts produced should be diverted for other purposes, the report suggested.

Among the various measurers suggested include promotion of copra as a dry fruit, the market potential for which would be studied by the Board in detail soon. Board also suggested comprehensive market potential activities for new coconut products through awareness campaigns besides suggesting incentives for exports.

The Board, however, feel thatimport of palm oil and its availability in the domestic market, in large quantity, had hit the coconut oil badly.

The Board is of the view that the coconut processing sector is gradually experiencing technological change and product diversification.

Though, the market has recently seen the arrival of a slew of new value added products, the capital expenditure needed for setting up such integrated coconut processing complexes are higher.

Therefore, the Board has suggested that the government need to promote such ventures by offering incentives like sales tax, excise duty exemptions for the sustenance of these projects, the report said.