The government’s plan to provide automatic spinning machines to co-operative coir societies and provide subsidy to private entrepreneurs is a positive move. The planned technological upgradation efforts in the small scale sector can make the workers in the traditional hand-spinning and hand-weaving industries threatened resulting in social tensions and strikes. But the budget has made provision to ensure their economic wellbeing by guaranteeing to purchase their entire production via PSUs at agreed prices. This is a very practical and considerate move.
The industry now meets 85 per cent of its raw material requirment–coconut husks—through imports from Tamil Nadu. The budget proposes to give subsidy for setting up coir fibre mills -- 75 per cent for co-operatives and SHGs and 50 per cent for private enterprises. We welcome the minister’s move to include private entrepreneurs in the scheme. But the challenge in a state like Kerala with very small and distributed land holdings is the collection of husks. Unless realistic schemes are worked out, producing coir fibre in Kerala will still be a distant dream. The emphasis on water conservation by protecting ponds, streams, rivers and other water bodies will drive up demand for coir geotextiles. That will ensure regular work for traditional weavers.
The overall emphasis on Infrastructure development is something that is going to help the industry in the long run. Operations in the coir industry are scattered with quite a long supply chain that passes through different processing centers. Coir is currently exempt from all taxes but it will be taxable with the advent of GST. And if the taxes are levied at each point in the value chain and the exporter has to pay all this and wait months or years for refund, then that will put a huge burden on the cash flow, resulting in the industry coming to a standstill. There should be a provision for fast-track refund of taxes to the coir industry.
Chairman, Federation of Indian Coir Exporter's Association (As told to T. Sudheesh)
