Central for Commerce and Industry Mr Piyush Goyal has asked tea industry stakeholders to submit a detailed proposal addressing various aspects involving the various sectors of the industry so that it can be thoroughly checked for further action.
On Sunday, Goyal held an interactive session with Tea Industry Stakeholders in Guwahati. During interaction sessions with the various tea stakeholder groups, he raised a number of issues concerning the tea industry, particularly in Assam. Minimum Support Price (MSP) for tea leaves, various schemes and benefits for small tea growers, a greater number of large-scale bidders at the tea auction, and other issues were highlighted.
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The Union Minister thoroughly discussed the issues with the attendees and assured them that appropriate measures would be taken. In its representation to the minister, the Tea Association of India (TAI) stated that one method of regulating supply is to limit tea imports into India.
Urgent action on surge
‘The country has seen a surge in tea imports in the last few years, with 60.35 Mkg. of tea imported in the last three years, of which only 23.43 Mkg. was re-exported. The remaining 36.92 M.kg were kept in India for domestic use. This imported tea puts additional pressure on the domestic market’s demand-supply equilibrium, resulting in further economic un-sustainability of the tea industry. The situation with tea in Darjeeling is much horrible, as imports of tea from Nepal exceeded 10 million kilogrammes out of 7.5 million kilogrammes of domestic production.’
TAI further added, ‘The Tea Industry in Darjeeling is thus gradually being wiped out, and we fear a similar fate for other tea growing regions of India if urgent action on the implementation of all legal barriers is not taken to arrest this surge in imports. Tea consumption per capita in India is as low as 830 grammes per person per year, compared to 1.61 kg per person in the United Kingdom. Even in India’s neighbouring country, Pakistan, consumption is 1.01 kgs per head per year.
An increase of even 100 grammes per capita consumption would consume an additional 131 MKgs. per year. The urgent need of the hour is to generate demand for tea through a generic promotion that positions tea as a superfood/beverage while emphasising the immense health benefits of tea. Such promotion will only create Supply and demand equilibrium, resulting in sustainable prices for our produce.’
Export Tea Diminishing
‘We therefore strongly urge the Government to allocate funds for standard tea promotion and entrust this promotion to a competent agency,’ TAI stated. Export Tea to Iran has been one of the bright moments for the Indian Tea Industry, reaching 53.70 M.kg. in 2019, which has now been diminished to 33.37 M.kg. in 2020.
‘This set of circumstances has emerged due to payment-related issues,’ TAI explained, ‘and this needs to be resolved so that India can maintain its foothold on the Iranian export front.’
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Finally, I would like to urge you to address logistical issues, such as container shortages, and to bring India up to international standards in terms of transportation mode, where the share of the road sector is 60 per cent, compared to 30 per cent in other countries. The road sector consumes the most logistics costs.’
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