Indian Tea Growers Address Challenges at Annual Meeting, Seek Solutions

The biggest group of Indian tea growers has identified many problems that are impeding the sector, including the importation of tea from Nepal and the increase in production costs.

Representatives from the Indian Tea Association gathered for the 62nd annual general meeting of its Terai branch on Friday in Bengdubi, near Siliguri, and discussed challenges impacting the industry.

Tea from Darjeeling

Due to its distinct muscatel flavor, Darjeeling tea is still regarded as the greatest tea in the world, although its output has decreased. Many gardens are located near one other in the hills, and tea firms that own gardens there struggle to remain sustainable.

Unlike the gardens in the Terai and Dooars, the holdings are tiny. The yield is also rather poor. However, their costs were the same as those of other gardens, including the cost of electricity and wages. It is for this reason that many gardens are struggling to turn a profit. The ITA secretary general, Arijit Raha, said, "We have requested a comprehensive package from the Center for the Darjeeling Tea industry."

Bring in from Nepal

Another issue that has been brought up by industry participants many times in recent years is the import of tea from Nepal.

The data indicates that almost 13 million kg of tea were imported in 2018; the majority of the imports originated in Nepal. We know that the same tea is shipped outside of this country and sold here. Atul Asthana, chairman of the ITA, said, "We have mentioned that such tea should comply with the standards of FSSAI (Food Safety & Standards Authority of India) to ensure that teas imported here are of standard quality."

Given that India produces over 1,300 million kg of tea annually, the import from Nepal may seem little, but it has an impact on the Darjeeling tea market since the two regions have comparable climates.

It is traditional leaf tea, such as Darjeeling, which is sourced from Nepal, rather than CTC tea. This is a fresh angle for Darjeeling tea, a grower from Siliguri said.

Asthana said that they emphasized the need for a minimum import price in their recommendations to the Union Commerce Ministry and the Tea Board. He remarked, "We have stated that teas that are less expensive to produce should not be imported and sold as it would affect our market."

Production expenses

The ITA also noted that while the minimum wage has not yet been set, there has been a 42% increase in tea salaries in Bengal over the last three years due to the state government's consecutive modifications.

Over the last ten years, the compound annual growth rate (CAGR) of tea prices has been 4.5%, which is less than inflation despite a 10%–12% rise in input costs.

Approximately 70% of the overhead expenditures in the structured tea industry (tea plantations) are set and cannot be decreased. The cost of manufacturing has been steadily rising, while auction prices have essentially stayed the same. The imbalance in supply and demand is added to it. To improve price realization, we must thus decrease supply, according to Raha.

Positive aspect

The state and federal governments' efforts are anticipated with excitement by the sector. They added that the state is offering tea workers and their families housing and other social benefits.

"It is advantageous for the sector since the Plantation Labour Act requires us to provide certain advantages. Such assistance is necessary for the tea industry's survival in the next days, according to Raha.

According to ITA Chairman Asthana, they have applied for financial help in different ways for the tea gardens as well as subsidies for the manufacture of orthodox teas.

Asthana said, "The state government's tea tourism policy is also helping tea gardens to explore alternative earning options as well as create some employment at the local level."

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