Coconut farming remains a vital source of livelihood for 10 to 12 million people in India, particularly small and marginal farmers. Contributing over Rs 7,000 crore annually to the nation’s GDP, the coconut sector plays a critical role in the rural economy, supporting not only cultivation but also processing and allied industries that employ an additional two million people across the country.
India ranks among the world’s leading coconut producers, alongside Indonesia and the Philippines, accounting for roughly 31% of global production. The industry is heavily concentrated in the southern states of Kerala, Tamil Nadu, Karnataka, and Andhra Pradesh, where over 90% of India’s coconut cultivation takes place.
Coconut is often hailed as the “Kalpavriksha” (tree of abundance) due to its diverse economic and nutritional contributions. Its products support about 6% of the national edible oil pool, making it an essential component of India’s food security.
Challenges in the Sector
Despite its significance, the coconut industry faces persistent challenges, including fragmented landholdings, low productivity, and rising labor costs. To address these issues, the Coconut Development Board (CDB) has implemented measures such as garden rejuvenation, replanting schemes, and the promotion of Farmer Producer Organizations (FPOs) to strengthen farmers’ market access and income stability.
Budget 2026-27 Initiatives
In the Union Budget 2026-27, Finance Minister Nirmala Sitharaman reaffirmed the government’s commitment to strengthening the coconut sector. Key initiatives include:
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Increased support for FPOs: Encouraging small farmers to pool resources, improve productivity, and access credit and markets efficiently.
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Infrastructure for processing and value addition: Investments in modern processing units aim to enhance profitability and reduce post-harvest losses.
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Rural livelihood programs: Expanding financial and technical support for smallholders, including crop insurance and sustainable farming practices.
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Research and innovation: Promoting climate-resilient coconut varieties and improved agricultural practices to boost yield.
Globally, more than 10 million smallholder farmers rely on coconut cultivation, primarily in Asia and the Pacific. India’s renewed focus on the sector through the 2026-27 Budget aims to ensure income security, strengthen rural employment, and make coconut farming more sustainable and profitable for generations to come.