22/03/2008 (The Hindu), Kochi - The Union government’s move to slash the import duty on palm oil will affect the coconut based industry in general and the trade in coconut oil in particular. The situation will have a disastrous impact on the coconut farming sector, which has been reeling under severe problems in recent years. Coconut farmers in Kerala will be the worst hit as the productivity had already declined in the State owing to a variety of reasons.

The root wilt disease that hit coconut palms and the high cost of labour charges had hampered the farmers’ interests. High productivity and diversified activity in the sector had been considered as the route to prosperity for the farmer. The Coconut Development Board (CDB) had been trying to implement replantation schemes so as to increase yield. In fact, planting of high-yielding varieties is part of the revival plan for the sector. The arrival of palm oil in large quantities had been one of the greatest threats faced by the coconut oil traders. A campaign against coconut oil had done its harm on the industry. The Board has been involved in programmes to counter the propaganda. Efforts to instil confidence in the farmer have been taken up at various levels. All such moves will have little impact in the wake of the new move to reduce import duty on palm oil.

The State government, on its part, had tried to help the coconut sector by preventing import of palm oil to ports in Kerala. In fact, the government had to fight a legal battle for the cause of uplifting the coconut sector.

The coconut farmers had been apprehensive of a lobby supporting the sale of palm oil. There had been a particular case of palm oil being brought by rail in tankers that used to carry non-edible oil while there was a ban on the import through Kerala ports.

The cut in import duty apart, the coconut oil sector was also facing adverse situation owing to the ban imposed recently on the export of coconut oil along with a few other edible oils.

The net result will be the shattering of the confidence of the coconut farmer. The hope that the farmer had nurtured out of the fresh impetus by the CDB and other agencies may fade now. It remains to be seen as to what steps the government will take to ameliorate the problems of the farmer, worsened by the new move.