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DAILY NEWS ANALYSIS

  • 13 March, 2023

  • 5 Min Read

Indian Tea Industry

Indian Tea Industry

  • India has implemented many measures to increase production to develop a specialised brand for Indian tea and guarantee the well-being of the families involved in the tea sector.
  • It is projected that Indian tea exports will reach 95% of the US$ 883 million goals established during 2022–2023 despite several geopolitical, geoeconomic, and logistical challenges.

Historical Perspective

  • China was the first country in the world to manufacture tea, and many of the tools used to make tea around the world were developed from traditional Chinese techniques.
  • As a result of British colonial India's need to import tea from China, which severely strained the nation's finances, the East India Company constructed tea plantations in Assam.
  • By the 1850s, India was one of the top tea-producing countries in the world. With independence, local tea brands were made accessible to the entire population as a beverage.
  • The East India Company lost its commercial monopoly with China with the Charter Act of 1833. Under William Bentinck, the Governor-General of India at the time, the Tea Committee was founded.

Status of Tea Industry

  • India, the second-largest tea producer in the world
  • Assam and West Bengal create the majority of the nation's yearly tea production, which will account for 83% of the total in the northern region of India in 2021–22.
  • Assam's two tea-growing areas belong to the Assam valley and Cachar.
  • The three main tea-producing regions in West Bengal are the Dooars, Terai, and Darjeeling.
  • The biggest producing states are Tamil Nadu, Kerala, and Karnataka, which together account for 17% of the nation's overall production.
  • For the fiscal year 2020–2021, India produced around 1,283 million kg of tea.
  • 1.16 million people are employed directly and an equivalent number is involved indirectly in the Indian Tea Industry.
  • The Tea Board of India oversees all the tea production in India.
  • One of the businesses brought under the authority of the Union Government by a Parliamentary Act is the tea industry.
  • India is one of the top tea-drinking nations in the world, with domestic consumers consuming 80% of the nation's tea production.

Initiatives by the Government to Grow the Tea Industry

  • The Tea Board of India launched a programme called "Promotion for packaged Tea of Indian Origin" to assist Indian exporters in consistently marketing Indian-origin teas in foreign markets.
  • The programme offers assistance with promotional efforts, including up to 25% of the cost reimbursement, exhibition in international department stores, creation of product literature and websites, and up to 25% of the cost of inspection fees reimbursed.
  • The Tea Board also offers domestic exporters financial aid so they can take part in international fairs and exhibitions.
  • The objective is to give exporters a platform to display their goods at international events for promotion and to make it easier to create trading opportunities.

Tea Board of India

  • The Indian Tea Cess Bill, which was approved in the year 1903, is when the Tea Board of India first came into existence.
  • Under Section 4 of the Tea Act of 1953, the current Tea Board was established.
  • Under the direction of the Ministry of Trade, it serves as a statutory body of the Central Government.
  • The Board is made up of 31 members, including the chairman, who are chosen from among members of parliament, tea growers, traders, and consumers as well as government representatives from the major tea-producing states and trade unions.
  • Kolkata is the HQ
  • Every three years, the Board is reconstituted. The Tea Board previously had offices in Kuwait and Egypt. These two offices, however, were moved to Dubai.
Export Data
  • India ranks among the top 5 global exporters of tea, accounting for 10% of global exports.
  • In the year 2021, the total value of tea exports from India was roughly USD 687.9 million.
  • India sends tea abroad to more than 25 different nations.
  • Some of the top countries importing tea from India are China, Russia, Iran, the United Arab Emirates, the United States, and the United Kingdom.
  • India exported 201 million kg of tea in total between 2021 and 2022.
  • Black tea accounts for around 96% of all tea exports from India and is the most common type.
  • Black tea, regular tea, green tea, herbal tea, masala tea, and lemon tea are among the varieties of tea exported through India.
Issues that the Tea Industry is Facing
  • The main problem facing the Indian tea industry right now is overproduction. India produces more tea than is needed to meet domestic and international demand.
  • Black tea is widely produced in China but is not eaten there. China is consequently attempting to push to sell the total quantity of excess black tea. As a result, Indian tea exports might be in danger.
  • Another risk to Indian export is that, with the introduction of the six-digit origin code for tea, India is no longer the country of origin following some value addition. The new product re-enters the Indian market after a minor value enhancement.
Way Forward
  • Due to the immense production capacity and the large number of people it employs in the northeastern regions, the Indian tea industry has numerous opportunities to grow.

The most important requirement for a very labour-centric industry like tea plantations is a fully transparent, sustainable model that strikes a good balance between the organic and modernisation approach.

Source: The Hindu


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