ITA forecasts recovery of tea industry

Kolkata, Aug 30 (UNI) India's tea industry is all set to be on a high growth trajectory with Indian Tea Association (ITA) forecasting higher exports, production and domestic consumption during the year.

"With the equilibrium in demand and supply, the industry had gathered growth momemtum, which would help in ending the seven years of recession," ITA, the apex body of tea growers, said in the status paper for 2006.

ITA had projected tea production of 930 million kilograms, consumption at 805 million kilograms and exports at 195 million kilograms in 2006.

Owing to lower availability of crop during the first six months, average prices in all the auction centres had improved, the status paper said.

This was opposite to the trend, which prevailed in 2005 characterised by lower price realisation, particularly in the CTC category, according to ITA.

The report also cautioned that the Indian tea industry would have to gear up for meeting global challenges. This, was only possible by lowering cost of production.

The report stressed the need for boosting replantation activity, which would raise productivity and improve quality of tea.

The paper said on the export front, the Tea Industry had identified three potential markets of Pakistan, Egypt and Iran.

ITA forwarded some suggestions to the government for boosting exports. These were branding and tea promotion activities in overseas markets and transport subsidy for tea movement from the North East.

Indian tea exports during 2005 declined by six million kilograms owing to loss in the Iraq market.

On the import front, ITA projected that during 2006 it would be 20 million kilograms as compared to 16 million kilograms in the previous year.

The ITA, however noticed a worrying feature. It said that retention of imported tea had increased in 2005. While only one per cent was retained in 2001, this proportion had gone up in 2005 to as much as 22 per cent in the country.

On the domestic consumption front, ITA suggested the Tea Board to carry out a detailed mapping exercise to judge the correctness of available estimates and projections.

Tea Board had recently commissioned IIM Calcutta to do a study on domestic consumption in India.

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