Kollam: As the moratorium on revenue recovery in the cashew sector ends on Friday, some 160 entrepreneurs will be in trouble as their endeavours have been declared non-performing assets (NPA) by the financiers.
The demand for a comprehensive package to revive the industry is still pending indicating the government has failed to intervene
effectively to help the sinking sector, despite a few meetings convened in the presence of the chief minister.
“Some 160 factories have been declared NPA by banks, and nearly 25 owners are on the verge of a financial breakdown.
Amendment of SARFAESI Act is the only solution to control the banks from coercive actions,” I. Nisamudeen, secretary, Federation of Cashew Owners and Exporters, told DC.
The processors point out the need for a financial
package to revive the cashew sector.
“Meetings were convened four times under the CM, but no productive decision was taken on financial package,” he alleged. A joint protest council formed by the entrepreneurs, their relatives, and cashew workers have planned to conduct a march in Thiruvananthapuram starting in front of the Reserve Bank of India to the Secretariat on September 10.
The moratorium declared on recovery proceedings against the factories declared as NPAs ends on August 31.
Some 400 small-scale cashew factories in the district remain closed owing to a slew of reasons including high operational costs that end up in an accrued loss.
The private owners allege they are denied sufficient time frame to repay the dues as the debt is listed as non-performing asset soon after the completion of 90 days of non-payment.
At present, the banks charge an interest rate of 9% - 12% on them which could be included as a financial package with the intervention of the government.
Proper repayment schedule long-term and availability of new working capital from the banks could save the sinking industry.
