**Executive Summary**
This document is a response to an unstarred question in Lok Sabha regarding the cashew industry crisis, answered on December 16, 2025. It outlines the government's efforts to protect the industry, including financial assistance via APEDA and a special One-Time Settlement (OTS) scheme coordinated by SLBC Kerala. Banks retain final implementation authority within the regulatory framework of the RBI.
**Key Points / Main Content**
* **Financial Assistance:**
* APEDA provides financial assistance for export promotion of scheduled products through its Financial Assistance Scheme (FAS).
* FAS has three components: (i) Development of Export Infrastructure, (ii) Quality Development, (iii) Market Development.
* APEDA invited proposals from cashew processing units and granted In-Principle Approvals (IPAs) of Rs. 5.33 crores to nine applicants for export infrastructure development.
* **One-Time Settlement (OTS) Scheme:**
* SLBC Kerala collaborated with the Kerala State Government and the Cashew Revival Committee to agree to a special One-Time Settlement (OTS) scheme.
* The scheme provides relief, allowing units with exposure up to ₹2 crores to settle at 50% of the base amount and those above ₹2 crores at 60%.
* The scheme's timeline has been repeatedly extended with ongoing government support.
* **Bank Implementation & Authority:**
* No exemptions for member banks from considering revival decisions have been submitted to the SLBC.
* Final adoption of the OTS scheme is subject to individual bank's Board approval, as banks maintain their own policies and frameworks.
* The approval and implementation of the State-level revival package are credit policy related, granting final implementation authority to respective banks within the RBI regulatory framework.
* RBI advises banks to make credit related decisions, including restructuring, based on their assessment of the borrower's viability prospects, in accordance with their Board approved policy and RBI's Prudential Framework for Resolution of Stressed Assets.
**Impact Analysis**
**Cashew Processing Units**
* **Impact:** Access to financial assistance for export infrastructure development and the opportunity to participate in the One-Time Settlement (OTS) scheme.
* **Action Required:** Submit proposals to APEDA for financial assistance; engage with banks and SLBC Kerala to participate in the OTS scheme.
**Banks (Including State Bank of India)**
* **Impact:** Required to consider and act upon revival decisions, but retain authority over final approval and implementation within their own Board-approved policies and RBI's regulatory framework.
* **Action Required:** Assess viability prospects of borrowers in the cashew industry, consider proposals for restructuring or settlement under the OTS scheme, and make credit-related decisions in accordance with Board policy and RBI guidelines.
**Government of Kerala**
* **Impact:** Collaboration with SLBC Kerala to support and protect the cashew sector through the OTS scheme.
* **Action Required:** Continue working with SLBC Kerala and the Cashew Revival Committee to formalize and support the implementation of the OTS scheme.
**APEDA**
* **Impact:** Responsible for providing financial assistance to cashew processing units for export promotion through the FAS scheme.
* **Action Required:** Evaluate and approve proposals from cashew processing units for financial assistance.
Key Entities Referenced
Cashew Revival Committee: Committee that coordinated with the SLBC Kerala on a special One-Time Settlement (OTS) scheme for the cashew sector.
Kerala: State where the government is trying to protect the cashew industry
Reserve Bank of India (RBI): The regulatory authority within whose framework banks make credit policy decisions, including restructuring related decisions
State Level Bankers' Committee (SLBC) Kerala: A committee that proactively collaborated with the Kerala State Government to support and protect the cashew sector.
Financial Assistance Scheme (FAS): Scheme through which the Department of Commerce, through APEDA, provides financial assistance for export promotion of its Scheduled products.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT OF COMMERCE
LOK SABHA
UNSTARRED QUESTION NO. 2742
ANSWERED ON 16/12/2025
CASHEW INDUSTRY CRISIS
2742. SHRI N K PREMACHANDRAN:
Will the Minister of COMMERCE & INDUSTRY (वाणिज्य एवं उद्योग मंत्री) be pleased to
state:
(a) whether the Government proposes to protect the cashew industry from crisis, if so,
the details thereof along with the action taken thereon;
(b) whether the Government initiate action to give directions to the bank for
implementing the revival package declared by Government of Kerala after
discussion with banks and stake holders of cashew industry, if so, the details
thereof along with the action taken thereon;
(c) whether the State Bank of India is exempted from implementing the decisions for
revival of cashew industries, if so, the details thereof;
(d) whether the Government initiate action against the SBI for its violation in
implementing the decisions taken in high level meeting for the revival of cashew
industries, if so, the details thereof along with the action taken thereon; and
(e) whether the Government proposes to give strict direction to SBI to implement the
package declared for the revival of cashew industries, if so, the details thereof?
ANSWER
वाणिज्य एवं उद्योग मंत्रालय में राज्यमंत्री (श्री णिणिन प्रसाद)
THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY
(SHRI JITIN PRASADA)
(a) to (e) : The Department of Commerce through the Agricultural and Processed Foods
Export Development Authority (APEDA) provides financial assistance for export promotion
of its Scheduled products through its Financial Assistance Scheme (FAS), in three
components: (i) Development of Export Infrastructure, (ii) Quality Development, (iii) Market
Development. Scheme guidelines are available at
https://apeda.gov.in/FinancialAssistanceSchemes. APEDA invited proposals from the
cashew processing units for development of export infrastructure and received a total of 12
applications, out of which 9 applicants were granted In-Principle Approvals (IPAs) for
financial assistance of Rs. 5.33 crores.
Further, the State Level Bankers’ Committee (SLBC) Kerala has proactively collaborated
with the Kerala State Government to support and protect the cashew sector. The SLBC
Kerala, in coordination with the Cashew Revival Committee, agreed to a special One-Time
Settlement (OTS) scheme for the sector, which was formalized by the Government. The
scheme offers substantial relief, stipulating that units with exposure up to ₹2 crores may be
settled at 50% of the base amount, and units with exposure above ₹2 crores may be settled
1at 60% of the base amount. The scheme's timeline has been repeatedly extended through
Government orders, with ongoing support.
No provision of exempting any member bank from considering and acting upon the revival
decisions has been submitted to the SLBC. However, the final adoption of the special State-
proposed OTS scheme, like all credit-related policies, is subject to the approval of an
individual bank's Board, as banks maintain their own Board-approved policies and pan-India
operational frameworks.
Any violation by State Bank of India (SBI) or any other bank is viewed in the context of their
operational mandate. The approval and implementation of the State-level revival package
are fundamentally credit policy related matters, and as such, the final implementation
authority rests with the respective banks, within the overall regulatory framework of RBI.
As informed by RBI, in a deregulated credit environment, banks have been advised to take
credit related decisions, including restructuring related decisions as per their assessment of
the viability prospects of the borrower, in terms of the Board approved policy of the bank,
subject to the prudential norms issued by Reserve Bank of India contained in the Prudential
Framework for Resolution of Stressed Assets. This is a principle-based, steady state
framework, which provides adequate flexibility to banks to design and implement resolution
plans, tailor made to suit the unique requirements of each borrower, including those from
the cashew industries.
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