Nation Other News 16 Nov 2016 Demonetisation: Aili ...

Demonetisation: Ailing cashew sector feels the pinch

DECCAN CHRONICLE. | SHAM MOHAMMED
Published Nov 16, 2016, 6:31 am IST
Updated Nov 16, 2016, 7:11 am IST
The funds crunch will make the companies miss the deadlines in exports and also enter the 'defaulter' list.
Every factory needs at least Rs 3 lakh per week to distribute  wages.
 Every factory needs at least Rs 3 lakh per week to distribute wages.

Kollam: The demonetisation has badly affected the wage disbursal  in the private cashew factories  owing to the curbs on fund withdrawal from the banks.  The processing lines in the factories  that provide  jobs to the majority of cashew workers in the state may grind to a halt  in a couple of weeks.  Every factory needs at least Rs 3 lakh per week to distribute  wages.  The funds crunch  will  make the companies miss the deadlines in exports and  also enter the 'defaulter' list.

“The private factories pay out wages on Fridays and Saturdays. The labourers working for almost six days a week won’t get time to stand in long queues in front of ATMs on Sundays even if we opt for distributing wages through  bank accounts.  The owners also lack money which has been stuck in their bank accounts,” Mr R.K. Bhoodesh, chairman, Federation of Indian Cashew Industries (FICI), told DC. The FICI has submitted a request to the central government demanding permission to withdraw sufficient money to keep  the cashew business afloat.

 

The cash shortage  does not affect the imports for which the payment is done online. Meanwhile, the gradual decrease in the workforce is likely to affect the export industry. “The factories enter into contract with foreign buyers  to deliver cashew within a  deadline of  one or two months. In the present situation, the processing in our factories has slwed down and we will miss the deadlines,” Mr. Bhoodesh added. Over 50 per cent of  private factories are still closed after the government declared  minimum wages. The owners are reluctant to open the factories claiming that the increased prices of raw cashew  in the market coupled with the wages have made the business non-profitable.

 

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Location: India, Kerala




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