India: Kerala’s bakery industry facing crisis

Thalassery / IN. (th) The first cake in India is believed to have been baked in the sleepy coastal town Thalassery in Kerala in 1883 but years down the line the bakery industry there is struggling to survive, with many renowned names planning to shutdown due to rising taxes.

For those who do not live on the subcontinent: Kerala is one of the 28 states of India, located in southwestern India. Neighboring states include Karnataka to the north and Tamil Nadu to the south and east; to the west is the Arabian Sea. Thalassery is a city on the Malabar Coast of Kerala. It is 21 kilometres from the district headquarters, Kannur. Thalassery municipality has a population less than 100’000, Wikipedia says.

Back to the bakery industry in Thalassery: The Kerala government´s recent decision to impose a 12,5 percent tax on all bakery products has dealt a heavy blow to the industry, says the President of Bakers Association of Kerala (BAKE) to «The Hindu».

Of the total 50’000 bakeries in the state, only five to ten percent are in the organised sector and the rest are all micro units, he explained. The state is said to be having the largest concentration of bakeries in the world, with Kannur district alone having about 600 to 700 bakery units.

Ranjit, who runs a prominent bakery chain in Kannur and whose relative Mambilly Baputty was believed to be the first bakers to make a cake in India in 1883, said to «The Hindu» the tax is only four percent in states like Goa. The 12,5 percent tax, imposed by the state government this year will cripple the industry, he said.