GOVERNMENT HELPS TEA INDUSTRY
Date : 26 Jul 2005
Location : New Delhi
The government has taken a number of measures to help the tea industry. The additional duty excise of Re. 1 per kg on tea has been withdrawn in the Union Budget for 2005-06. Government has also recently sanctioned two schemes i.e. subsidy for the production of orthodox teas and assistance to the two tea Research and Development Institutions from special fund created with collections of additional duty of excise on tea. A Special Tea Term Loan (STTL) for the tea sector was announced which envisages restructuring/ rephrasing of irregular portion of outstanding term/working capital loans in the tea sector with repayment over 5 to 7 years and a moratorium of 1 year to small tea growers and bought leaf factories, which is extended on a case to case basis for large tea growers. The STTL also provides for working capital upto Rs 2 lakhs at a rate not exceeding 9 % to small growers. The other measures taken to help the tea industry include the implementation of a price sharing formula between small tea growers and manufacturers of tea w.e.f. 1.4.2004, implementation of a price subsidy scheme for small tea growers for a four month period from February to May 2004, reduction in the import duty on items of machinery used to improve productivity and quality of tea, including value addition to an inclusive rate of 5 % etc. Besides, a number of developmental schemes arte also being implemented by the Tea Board during the 10th Five year Plan for enhancing productivity, quality and marketability of tea produced in the country.
A stakeholder’s conference on tea was convened by Shri Kamal Nath, Commerce and Industry Minister on 16th and 17th September 2004 where the most important recommendations pertained to rejuvenation and replantation of old tea bushes with a view to raise productivity. Detailed costing and modalities of funding this large programme are under the consideration of the Government. In order to sustain the domestic market, various promotional activities are being undertaken by the Tea Board in addition to the marketing efforts made by the tea industry. This includes issuance of regular advertisements of generic nature in various domestic publications on health and lifestyle aspects of tea, participation in various important fairs and exhibitions all over the country. Steps taken to increase exports of tea include implementation of a medium term export strategy encouraging production of quality teas specially orthodox type of teas, participation in major trade fairs/ exhibitions abroad, lending promotional support to Indian exporters in marketing Indian brands, field sampling at speciality stores and in principal markets, exchange of tea delegations, launching media campaigns to increase consumer awareness etc. in order to maintain quality and retain brand equity of Indian teas, Government has issued a new Tea (Distribution and Export) Control Order, 2005 on 01.04.2205.
This was informed by the Minister of State for Commerce and Industry Shri EVKS Elangovan in the Lok Sabha here today.