The Tea Board of India has short listed three international consultants-McKinsey, PricewaterhouseCoopers and Accenture (formerly Andersen Consulting) -to work out a mid-term export strategy for the Indian tea industry.

Talking to reporters after the 111th annual general meeting of the Calcutta Tea Traders Association (CTTA), N. K. Das, Tea Board chairman said: "About 12 consultants made representations to us, of which we have shortlisted three. We are now negotiating with them and will be able to select one out of the three within a week's time."

Das said in the last financial year, India imported about 10 million kgs of tea.

"The industry has raised questions about the quality of tea that has entered India. We are going to take up the matter with the customs authorities and demand that the imports should pass the PFA test."

Replying to queries raised by CTTA members, Das said the Tea Board had a meeting with commerce secretary Prabir Sengupta on April 30 on the exports and auction system. The meeting, also attended by merchant exporters, discussed the need to take a relook at the auction system. "We have decided to set up a professional body who will examine the present auction system and come up with suggestions," Das said. Further, the need to aggressively promote Indian tea in international markets also featured in the discussions.

The Tea Board chairman said they have identified several areas which will have to be given special attention-rejuvenation of plantations, increasing exports, which have dwindled from 41 per cent in 1950 to 14 per cent now, the small growers welfare scheme, emphasis on irrigation, drainage and R&D, value-addition and quality upgradation.

"We will include these in the Tenth Five-Year Plan," he said.

CTTA's previous chairman, D. L. Thapar, said clause 17 of the Tea Marketing Control Order has been amended in January this year and it is no longer obligatory for tea producers to sell 75 per cent of their production through the public auction system.

He said the public auction system will be attractive both to the seller and the buyer if it is able to handle teas in an efficient manner.

Business Standard 05.05.2001)

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INDIA needs to work hard for increasing its share in the world tea market rather than complaining about import threats from Sri Lanka, Tea Board chairman N K Das said on Friday.

"Our share in the world market has come down to 14 per cent from over 41 per cent in the 1950s and we are working on a strategy to bring back the past glories," Das said.

To achieve this, Mr. Das said, the first and the foremost thing needed was an all-round effort to increase the quality of Indian tea through value addition.

"It is unfortunate that Indian tea prices are going down at a time when world tea prices were moving up and to counter this we need to create a niche for our products through value addition, concentration on R & D, and by producing tea in hygenic and clear manner," he said.

With world supplies increasing, India's target should not be quantity, but quality, Das said.

The Economic Times 05.05.2001)

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Vietnam and Pakistan have agreed to increase their annual bilateral trade to achieve 100-million dollars from the current 15-million dollars.

Pakistan's military ruler General Pervez Musharraf said, at the end of a three-day official visit to Vietnam, that Islamabad sees Vietnam as a potential market for its cotton, fabrics, garments and pharmaceutical products.

He said Pakistan also wants to import tea, pepper and farm products from Vietnam.

General Musharraf said the two countries also agreed to hold working-level consultations once every three months to help strengthen their economic ties.

The military ruler said his country will send groups of experts to study onshore and offshore development as well as rice cultivation in Vietnam.

Pakistan is keen to strengthen relations with the Association of Southeast Asian Nations through Vietnam, which holds the rotary chairmanship of the standing committee of the regional group. May 2001

abc.net 05.05.2001

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China's announcement that it will be growing tea without using chemical fertilizers and pesticides in causing concern to organic tea producers in India.

This is because the market for organic tea is restricted to some European countries and Japan, and the buyers there are no longer willing to pay high premiums for chemical-free tea.

"China will be a big threat to our dominance of the world organic tea market," says KS David, managing director of Goodricke Group Limited, India's largest producer of organic tea and a subsidiary of Lawrie Group of the UK.

"You know once China decides to do something, they follow it up pretty fast. The saving grace for Indian exporters is that conversion into organic farming and growing organic teas in virgin lands are both a time-consuming process," he says.

China has chosen Yunnan, the country's largest tea-growing province, for growing organic tea, David says the Yunnan provincial government's plan is to invest approximately $753,000 in each of the next five years to create a dedicated organic tea plantation on 6,667 hectares. Indian industry officials say the recent export setback in Europe, particularly in Germany, which has very stringent chemicals residue norms for tea, has led to the Chinese decision to grow tea without using artificial fertilizers and pesticides.

"Chinese productivity is around 600 kg/ha and therefore, the country is targeting an organic tea production of 4 m kg when all the bushes in the new plantation start flushing leaves at the optimum level," says a local planter.

David says India's main competitor in the world market for organic tea is Nepal, which is a relatively new producer of the beverage. Because of its relatively low cost of production, Nepalese organic tea is sold at a big discount to Indian prices. This is hurting Indian producers, particularly as some Nepalese teas grown in high altitudes come close to Darjeeling teas in terms of quality.

India's production of organic tea is concentrated in the hills of Darjeeling where a number of gardens began "self-sustainable farming" based on the use of organic manures and biological control of pests nearly 15 years ago.

"The campaign to grown tea using natural resources available in the proximity of gardens has led to an annual production build-up of nearly 1m kg of organic tea in Darjeeling that is about 10 per cent of the total tea output in the hills," says David.

"Organic farming amounts to going back to nature. As you start growing tea without using inorganic matters, the first task is to rid the soil of all chemical residues. Years of use of inorganic chemicals harmed the soil structure of Darjeeling hills," says Jagmohan Puri, GM of Dooteriah.

A small amount or organic tea is also produced in southern India and Assam. But as the premiums for organic tea in the world market are getting squeezed, further conversion to organic farming in Darjeeling has stopped.

"The conversion to organic farming leads to substantial production loss at the outset. It takes at least eight years for a garden converted into organic farming. Production loss over a long period and the cost of conversion will be justified if the buyers are ready to pay good premiums for organic tea," says Puri.

Business Standard 05.05.2001

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