Liabilities hegemonise companies as ‘Neera’ steps into tenth year

Vadakara: When Neera was first introduced in Kerala, expectations were high. A monthly income between Rs 1000-3000 from a single coconut tree. If Neera is extracted from merely 10% of  coconut trees and sold per litre, the state’s per capita income would be Rs 14,000 crores. These were some of the aspirations shared then.

As Neera steps into its tenth year since production, everyone has given up on it. From the Coconut Development Board (CDB) that led the move by agri-companies to produce coconut water to the state government that permitted this, everyone has abandoned Neera.

Neera production in the state has come down from 400 litres to hardly 200 litres. The 11 coconut producing companies that set up plants for Neera production now hold a liability of Rs 30 crores. Although a moratorium was in place till March 2023, many of them have started receiving foreclosure notices. Even the property held by the company directors face threat of confiscation.

The 11 coconut producing companies set up Neera plants at Rs 2 crores each by availing loans from Kerala Financial Corporation (KFC). The government offered a subsidy of Rs 50 lakhs. 

Even as the companies were facing challenges in the market, demonetisation posed a grave threat. Before they could recover from this, Covid struck and brought everything to a standstill, stopping the repayment by the companies. Due to high interest rates, the liability continues to increase day by day. As the companies ran out of working capital, all roads towards revival closed.

Most of these companies that set up plants do not produce Neera presently. The Vadakara company, the only one that found some headway among these companies, now produces Neera only for three-four months in a year. 

20,000 bottles remain in stock. Palakkad company procures less than 100 litres per day. The only plant that produces Neera without interruption is the Thrissur company. The Kaipuzha company stopped production due to lack of tappers. It has been years since the Kuttiyadi company stalled. 

The previous LDF government had formulated a plan to release a tetra pack version of Neera with assistance from KIIFB. The plan was to launch a uniform flavour across the state. This too, saw no progress. 

The CDB that encouraged farmers to indulge in Neera production has turned its back on farmers for many years. On May 30, the companies had presented their crisis before the board but no action was taken.  

Although the Agriculture Minister announced aid for the companies, no relief measures were introduced.The Chairman of the Consortium of companies, P Vinod Kumar said that if the government considers including existing companies into the project where new companies are offered loans at 5.5%, it may prove to be a relief for these Neera plants.