By Syed Zarir Hussain, IANS
Guwahati : India’s recession-hit tea industry has launched an aggressive drive to increase production and value of the beverage, despite stiff challenge from countries producing cheap teas.
“The new tea strategy now is to chase both volume and value in exports. We are getting positive results and 2007 is turning out to be a good year for tea,” Minister of State for Commerce Jairam Ramesh told IANS.
India is currently the world’s largest tea producer after China with a record crop of 955 million kg last year with the northeastern state of Assam accounting for about 55 percent of the total produce.
India’s $1.5 billion tea industry was facing a crisis with prices dropping in the weekly auctions since 1998 and exports plummeting as well.
The industry was, however, showing signs of resurgence – a kilogram of good quality tea fetched Rs.73 in recent weekly auctions compared to the average price of Rs.68 last year.
Exports have gone up by about 8 million kg to 200 million kg last year compared to 2005.
“These are good indicators and we are sure prices would firm up and exports increase despite a good crop in Kenya,” said Ramesh, who was here to work out a deal with IT major Tata Consultancy Services (TCS) for investments in Assam.
The slump in prices and exports was largely attributed to cheap and inferior quality teas produced by many new tea-growing countries, thereby pushing premium quality Indian teas to facing stiffer competition in the global market.
“The overall mood is vibrant with the Indian tea industry now beginning to look up with overseas demand on the increase mainly due to very good quality teas produced by us,” said Dhiraj Kakaty, secretary of the Assam chapter of the Indian Tea Association (ITA), the country’s apex tea administration body.
The central government in June launched a whopping Rs.48 billion package to help the country’s beleaguered industry replant aging tea bushes to boost quality and production.
“The Special Purpose Tea Fund is a project covering about 200,000 hectares in 1,000 of India’s nearly 1,600 plantations,” Ramesh said.
India’s tea production is expected to jump by close to 40 percent once the aging bushes that are more than 50 years old are replanted or rejuvenated.
“This is a long term project that would help change the face of Indian tea both in terms of production and quality,” the minister noted.
Spurred by recent successes in drawing foreign buyers once again, the commerce ministry is organising an International Tea Festival in Guwahati in November.
“We are expecting delegates from Pakistan, Iran, Egypt, the UAE and the UK for the festival that is expected to help boost exports of tea,” the minister said.
India has already set up a marketing bureau in Tehran and soon opening an office in Cairo to promote tea.