Q: Flood has been causing havoc to the tea gardens of Assam and North Bengal every year. Although, major responsibility lies with the state administrations, yet, what role the Tea Board can play in this regard ?

Das: We take up the matter with the respective State Governments and extend all possible help in this regard. We also forward their representations to the Governments.

Das: One of the reasons for the decline in export is economic recession in some major countries. The Russian economy afflicted with the Rouble crisis in August 1998 has not yet recovered fully. Russia is now looking for cheap teas, which would be affordable by the majority of the consumers.
The Board is in the process of working out medium tern and long term plans for increasing export to certain thrust markets. CIS countries and Russia have been identified among others as thrust areas.
The Tea Councils in USA, Canada, UK and Germany of which India is a member are conducting promotional campaigns to focus tea as a health drink. We are optimistic that this will translate to increased export from India.
Tea export from India is facing competition from Sri Lanka, Kenya and China. Unlike China, Kenya and Sri Lanka has small domestic market and therefore there is need of offloading teas of Sri Lanka and Kenya in the international market at any price. In fact, there is no perceptible growth in global tea import for consumption between 1993 and 1999. In 1993 global tea import for consumption was 1129million kilogrammes which was declined to 1080 m.kgs in 1995 and marginally increased to only 1181 m.kgs in 1999. The import in UK and other parts of West Europe has registered a decline over the years during this period. The same is the case of countries in Oceania. So business of growth in the world import has compelled the tea exporting countries like India, Sri Lanka, Kenya and China to export tea at the expense of others. However, during first 7 months of current year export of tea from India registered an increase of around 5.8 m.kgs compared to corresponding period of 1999.

Das: Indian Institute of Management Calcutta undertook the study on the trend of domestic consumption of tea in India first in 1984, then in 1995 and recently in 1999. During the study of 1984, IIM estimated the annual increase of per capita consumption of tea at 9 grams per head per year based on the state level consumption of data of National Sample Survey Organisation (NSSO) for the year 1972-73 and 1977-78 revealed that the annual per capita consumption of tea increased by 6 gms per head per year. Based on such increase the per capita consumption of tea as projected by IIM as also as estimated by Tea Board is given below:

In terms of per capita annual consumption of tea, according to IIM Calcutta, it would be 624 gms in 1995 and 653 gms in 2000 indicating thereby annual increase of little less than 6 gms per head per year between 1995 and 2000. It is also true that tea consumption in India and in the international market is facing competition from soft drink beverages.

Q: What is the scope for foreign direct investment (FDI) in Indian tea industry and how that is necessary?

Das: Tea plantation should not be categorised as an ordinary agricultural crop since it requires high investment and long gestation period. With stiff global competition in the external market and soon in the internal market being a reality, it is important that investment in this sector should be encouraged along with global technological, managerial and marketing skill. Regarding overall principle of allowing FDI in the tea plantation sector the view of CCPA and UPASI are relevant. CCPA has suggested that foreign share should be restricted to 74% while UPASI has opined that this could be considered even up to 100%. Tea Board is of the opinion that FDI up to 74% appears to be acceptable keeping in mind social aspect, which is directly linked with high productivity and profit in this tea plantation sector. Liberalisation of FDI should lead to development in the backward region of the country where tea is cultivated particularly Assam and North East.

Das: Import of tea into India is subject to Indian Law. Section 5 of Prevention of Food Adulteration Act stipulates that no person can import tea which is not in conformity with the specifications laid down under the said Act. Apart from such provision Tea Board requested the office of Director General of Foreign Trade for amendment to different provisions of Import-Export Policy and Procedure for enforcement of quality standard of Import of tea into India. Moreover, at present Port Health Organisation attached to different ports are analysing imported teas before its release from the port areas. The specifications for tea under PFA are more or less similar to the international standard namely ISO 3720.

Q: Does the waiver of Shipment Licence has geared up export execution in due time? Reportedly the Board is facing problem in generating export, price and quality related data due to the waiving. Is it true that the board has taken initiative to get back the right to issue Shipping Licence?

Das: Keeping in view the liberalised trade environment the provision of obtaining shipment licence has been dispensed with since 1995. The export during 1995-1999 given below:

The statistics on export is now collected directly from different customs authorities for compilation of information on all India basis. Tea Board is not taking any initiative to re-introduce the system of issuance of shipment licence.

Q: Are you taking any step to bring mushroomed tea gardens, which has come up mostly in North Bengal, under the Tea Board?

Das: As per Section 12 of Tea Act 1953, no one shall plant tea on any land not planted with tea unless permission has been granted to him in writing by or on behalf of Tea Board. In view of such Section Tea Board is issuing permission for extension and/or replacement of tea areas as well to enable "Tea Board to grant registration for any tea garden (including small tea garden) there is a need for submission of the documents relating to the possession of the tea area either on lease or on ownership basis. Tea Board is granting registration as and when such documents are produced by any intending tea growers.

Das: (a) Sikkim, b) Orissa, c) Arunachal Pradesh, d) Manipur, e) Meghalaya, f) Mizoram, g) Nagaland, h) Idukki and Wynad Districts of Kerala, i) Kidagu District of Karnataka, j) Kodaikanal and Anamalais Districts of Tamil Nadu, k) Kumaon and Garhwal Division of Uttar Pradesh, l) Chamba and Mandi Districts of Himachal Pradesh, m) Palakkad Districts(Attapadi block of Mannarkad Taluk) of Kerala, n) Kishanganj District (Blocks – Kishanganj, Takurganj, Pothia, Dighalbank and Bahadurganj) of Bihar, o) N.C. Hills and Karbi Anglong Districts of Assam, p) Southern Districts in Tripura, q) Identified marginal Coffee lands for conversion into tea as per accepted Schedule in the State of Karnataka, Tamil Nadu and Kerala.

Q: The Tea Board had taken initiative to patentise the Darjeeling Tea on the basis of the geographical location. What is the current position of that move? Board had asked the Darjeeling tea growers, manufacturers and business houses to register with the Board for the Certification of Trade Mark. What was the reponse?

Das: Tea Board has already launched Darjeeling Certification of Trade Protection Process to safeguard the misuse of the name Darjeeling. Tea Board’s registration of the Darjeeling Certification Trade Mark in the Mumbai and UK Trade Registries is at a very advance level of processing. Examiners’ queries at both registries have been replied to. The registration in India is due to go to the Ministry for approval soon.
A total of 128 companies have already registered under the Darjeeling CTM Protection Process. This includes all producer Exporter companies and 56 trade/exporter companies.
All export consignments are being accompanied by a Certificate of Origin from Tea Board after verifying production details at the garden level.
The Industry has come to appreciate the Darjeeling Certification Trade Mark Protection Process and is now actively supporting it.

Das: Tea Industry is demanding for repealing of different Orders issued under the provisions of Tea Act in view of liberalisation era. The allegations of adulteration of tea with various essences are being dealt under the Prevention of Food Adulteration Act. In fact, Ministry of Health, Govt. of India allowed manufacture and sale of flavoured tea. Such flavoured teas are not injurious to health. Apart from this, adulteration of tea is also monitored by Tea Board under different provisions of Tea Waste (Control) Order.

Das: Different Control Orders have different objectives. For example, Tea Waste (Control) Order is helping Tea Board to monitor the disposal of Tea Waste by tea producers and tea waste dealers. It also helps to prevent misuse of tea waste, which is a by-product in the process of manufacture in tea from green tea leaves. This tea waste is also used as a raw material for manufacturing Instant Tea and Caffeine. Use of such tea waste by different users is monitored by Tea Board under the provisions of Tea Waste (Control) Order.
Similarly, Tea (Marketing) Control Order enables Tea Board to register tea factories, brokers, auction organisers, etc. Tea auction organisers and tea brokers have an important role in marketing of tea. The monitoring of production and marketing is being made by Tea Board under the provision of Tea (Marketing) Control Orders. So the demand for repealing such Orders are not based on any valid assessment of the situation.

Das: Under the free market regime and in the area of WTO Indian Tea industry has to face both the threats and opportunities offered in the regime of free international trade. The quantitative restriction will be removed after April 2001. So there is a need to protect the Indian tea growers particularly small tea growers in absence of licencing system in relating to import of tea. This could be done by way of enhancement in the import tariff. Moreover, under the provisions of Agreement on Agriculture, India has to allow import of tea for domestic consumption.