Coconut Development Board (CDB) is one of the youngest export promotion councils in India. In a freewheeling interaction with The Dollar Business, Dr. Anand Kumar Singh, the Immediate Past Chairman of CDB, who now heads the Horticultural Science division of Indian Agricultural Research Institute (IARI), talks about the initiatives taken up by CDB to boost exports of coconut products.

Interview by Niladri S. Nath | July 2017 Issue | The Dollar Business

TDB: It has been eight years since the Coconut Development Board was established. Have you been able to attain what you set out to achieve?

Anand Kumar Singh (AKS): It has been a successful journey for Coconut Development Board – Export Promotion Council (CDB-EPC). For instance, in FY2016, when the cumulative exports of India decreased by about 15% (y-o-y), exports from the coconut sector achieved a growth of 10% y-o-y. The sector has an uninterrupted supply of raw materials, and the superior quality and competitive price of our products have been driving growth. FY2017 has also been a good year too. Our exports revenue touched Rs.2,300 crore, which is Rs.849.76 crore more than that in FY2016.

The export revenue target for CDB-EPC is Rs.5,000 crore by FY2020, but our goal is to reach Rs.10,000 crore in the same period. However, I must point out that the budget allocated to CDB is not in tune with the target. While our annual funding requirement is at least Rs.500 crore, we have received only Rs.125 crore in FY2017 from the government. I think unless we adopt aggressive international marketing strategies, just innovation and productivity improvement methodologies cannot not help us increase our exports. Government funding to support our international marketing efforts will go a long way in giving exports a boost.

TDB: Philippines, Indonesia and Sri Lanka are the largest exporters of coconut products in the world. Do you think India can take them on?

AKS: India has enough potential to emerge as the leading exporter of coconut products in the world. In FY2015 India was the largest producer of coconuts with a production of 2,044 crore nuts. Kerala, Tamil Nadu, Karnataka and Andhra Pradesh account for 90.11% of the total production and coconuts from these states have high-quality kernels, which are ideal for producing value-added products. The sector has ample export opportunities for both existing producers as well as entrepreneurs. So, my answer is yes, we can take them on.

TDB: Are incentives given by the government enough to boost exports?

AKS: Most coconut products receive export-related incentives. However, the incentives for some products like activated carbon manufactured from coconut shells and virgin coconut oil need to be increased – we have already taken this up with the government. Since this is a volume business and coconut products are perishable by nature, it would be great if the government could extend some assistance with respect to transportation to encourage exporters. Also, value-addition can, at times, become a costly proposition for the sector because coconuts production is widely dispersed across the country. We are supporting manufacturers and exporters in our own ways – for instance, the National Horticulture Board, which CDB is a part of, offers 50% subsidy to manufacturers who want to buy refrigerated vans. But, a little more financial assistance could go a long way.

TDB: In February 2017, CDB organised an exporters’ meet in Kochi. What was the agenda of the meeting?

AKS: The exporters’ meet was organised to offer a comprehensive view of the current export scenario, schemes and provisions in various policies that could benefit our coconut product exporters. It was a wonderful opportunity for the exporting community to share their thoughts and concerns. We plan to conduct more such meets this year.

One of the important issues that we discussed was the rewards under Merchandise Exports from India Scheme (MEIS) for activated carbon. The current MEIS reward rate is only 2%, whereas coconut shell charcoal receives 5%. We want the incentives on both to be at par.

Also, because of some unfavourable policies, the shipping charges for coconut-based products are higher in India than in countries like Philippines and Indonesia – our closest competitors in the global market. So, the government must consider giving more incentives to coconut products to make our exports more competitive in the global market. In addition, since coconut products are perishable, they should be given special treatment at ports, railway corridors, etc. They should be allowed to move at a faster pace to avoid any damage. If these measures are taken they will benefit exporters immensely.

TDB: How is the Board assisting entrepreneurs in adding value to products?

AKS: The demand for value-added coconut products is on the rise. Indian entrepreneurs too are concentrating on value-added product categories as they offer wider opportunities. For instance, virgin coconut oil presently commands a premium in international markets.
Also, packaging plays an important role in connecting with the end-consumers, especially in the international markets and CDB is trying to help exporters with new packaging solutions.

The CDB Institute of Technology, at Aluva in Kerala, is working to develop new processing technologies as well as innovative products.

Besides helping with setting up new processing units and upgrading the existing units, we help entrepreneurs and exporters to participate in B2B meets, overseas exhibitions and industrial visits. We also contact foreign embassies to find out about the latest growth opportunities. To add to that, we have a strong market intelligence division that keeps a tab on global trends in coconut-based products.

TDB: What initiatives has CDB taken to increase coconut production?

AKS: At the moment, we are focussing on producing and supplying quality seedlings, especially the hybrid varieties, to cater to the growing demand. We are also promoting integrated farming in coconut holdings to improve productivity. CDB also promotes adoption of scientific practises in various clusters. In addition, replantation and rejuvenation of senile and unproductive palms in traditional coconut growing states are being undertaken. We are expanding coconut production in non-traditional areas like north India apart from promoting organic farming and integrated pest and disease management in community farms.

TDB: What are the major markets for coconut products from India? Are you exploring any new market as well?

AKS: GCC countries, US, UK, EU countries, Japan, Iran and South Africa are India’s main markets for coconut products currently. However, we are also looking at Malaysia, Canada, Russia, South Korea, China and Pakistan as potential markets for our products. Exporters, both new and old, can look at these regions to expand their business. Activated carbon from coconut shells, coconut oil, desiccated coconut powder, copra (dry coconut kernel), ball copra, shell charcoal and virgin coconut oil are emerging as products in demand. While exploring newer markets will obviously increase our exports, our endeavour is to see that the benefits of increased exports also reach our farmers.

TDB: CDB recently approved 38 projects under the Technology Mission on Coconut. What role will these projects play in increasing exports?

AKS: These projects, approved by the Project Approval Committee of CDB, will play a big role in increasing exports of coconut products from the country. Out of the 38 projects, 32 are dedicated to process improvement and product diversification while three are for research and the rest are geared towards market research and promotional activities.

The 32 approved processing and product diversification projects are focussed on desiccated coconut powder, virgin coconut oil, neera (the non-alcoholic and nutritious drink from the immature inflorescence of coconut tree), coconut oil, copra-dryer units, ball copra-making units, shell charcoal units and activated carbon units. These projects will certainly help increase the exports of value-added coconut products from India. We expect these projects to result in an export revenue growth of approximately 15-20%.