GST Reforms to Boost Kerala's Economy: Relief for Spices, Seafood, Tourism & Ayurveda
Kerala's cashew, coffee, spices, seafood, tourism, and Ayurveda sectors benefit as GST rates fall to 5%.
New Delhi, Oct 8 (PIB):
Kerala's diverse economy - spanning spices, seafood, tourism, and Ayurveda - is set for a major revival under the new Goods and Services Tax (GST) reforms announced this week. By lowering tax rates across multiple industries, the reforms are expected to reduce costs by 6-11%, expand global competitiveness, and strengthen incomes for millions of workers.
Agriculture and Plantation Gains
Cashew processors in Kollam, employing over 3 lakh workers, will see GST on roasted and coated nuts reduced to 5%, cutting costs and boosting export margins. Wayanad's Robusta coffee, Malabar pepper, and Alleppey green cardamom - all GI-tagged products - now enjoy reduced rates, ensuring stronger market presence for smallholder farmers and exporters.
Food Processing & Agro Industries
Kerala's GI products such as Vazhakulam pineapple and Kuttiattoor mango-based jams and pickles will become more affordable, benefiting farmers and micro-processors. Tirur betel leaf producers and banana chip makers across Thrissur and Palakkad also gain from the reforms, adding resilience to Kerala's cottage industries.
Fisheries and Seafood Exports
With over one million fisherfolk dependent on the sector, the 5% GST on seafood processing is expected to enhance export competitiveness. Kerala exported marine products worth ₹8,285 crore in 2022-23, and the rate cut is likely to improve margins while stabilizing fisher incomes.
MSME and Cottage Industry Impact
Tea estates in Idukki and Munnar, employing more than 4 lakh workers, stand to benefit as tea products now attract just 5% GST. Similarly, coir production - where women make up 80% of the workforce - will gain from cost reductions, improving Kerala's dominance in global coir exports.
Tourism and Ayurveda Boost
Hotels and homestays priced up to ₹7,500 will be taxed at 5%, making Kerala's hospitality sector more attractive for tourists. Ayurveda medicines and treatments, now under the same rate, enhance Kerala's position as a global wellness hub.
Inclusive Growth
Officials highlight that the reforms aim to spread benefits across farmers, fisherfolk, small entrepreneurs, and workers. From spice gardens in Idukki to fishing harbors in Kochi and coir clusters in Alappuzha, Kerala's traditional industries are expected to witness renewed growth.
