Govt outlines steps to increase tea exports

New Delhi, Mar 7 (UNI) Concerned over the declining share of India's tea exports in world markets, Minister for Commerce and Industry Kamal Nath today said the government proposes to set up a Special Purpose Tea Fund for financing replantation and rejuvenation of old tea bushes, the modalities of which were being worked out.

Mr Kamal Nath told the Lok Sabha during question hour that the main reason for the country's declining exports was that India mainly produces CTC tea, while the demand was for orthodox and green tea in global markets.

Besides, competition from other producers has intensified, including from Kenya, Sri Lanka and China, which produce varieties in greater global demand.

Mr Kamal Nath said investment from tea companies was on the decline and there was need for concerted action for rejuvenation and replantation of old tea bushes.

The Minister said a Special Fund has been created with the Additional Excise Duty of Rs one per kg collected on tea during 2003-04 and 2004-05 for the development of the tea industry.

He said there was a time when India controlled 50 per cent of the international markets, but now its share was only about 12.84 per cent.

The country, he said, was a large consumer of tea and the domestic demand was mainly for the CTC variety.

Mr Kamal Nath said tea exports this year may not even reach last year's level, adding that the requirement in the international markets was for quality tea. It was important to improve the productivity of tea production.

In reply to a supplementary, Mr Kamal Nath said issues such as promoting tea as a health drink were being dealt with by the Tea Board which keeps a close watch on the market demand.

UNI GS LR DB1326