However, tea industry sources said, it seems hard to retain the traditional market of the Indian tea — specially in UK, CIS countries and UAE,  blaming the absence of aggressive marketing policy to compete with the emerging global leaders like Sri Lanka and Kenya in the international tea market.

A rapidly declining market share in the UK has become a matter of grave concern for the Assam tea industry, since Assam produces a large quantity of CTC tea, mostly consumed in the UK. The industry, which once almost enjoyed monopoly in the UK, has been losing its market share to Kenyan tea for almost a decade, added the sources.

Assam tea, which first landed in the UK in the year 1838, had enjoyed almost 100 percent market share in that century. But with the arrival of comparatively cheap tea from Kenya, and lack of adaptability and aggressive marketing on the part of India, Assam’s CTC tea started losing popularity in the UK. According to the sources, currently Indian tea constitutes less than 13 per cent of the total tea market in the UK.

The industry sources said, India export only about 22 million kg of tea to UK per annum, where the total demand of tea in that country is about 161 million kg.  “The recession in the Assam tea industry since 1999 has been partly because of declining markets outside,” said Bidyananda Barkakoty, vice chairman of North Eastern Tea Association (NETA). “We will have to regain our traditional market to revive the Assam tea industry,” he added.

The tea industry partly puts the blame on the Tea Board of India for not paying adequate attention to the “traditional” markets for which those markets slipped out of hand. “The Tea Board is more interested in exploring new markets than retaining the old ones. I think that the Tea Board officials might have got tired of visiting the same old cities. So, on the pretext of exploring new markets they explore new towns and cities for themselves, unmindful of the harm they cause to the industry due to their negligence of existing markets” a tea industry source said.

Kevin McCole, deputy head of mission of the Kolkata based British Deputy High Commission also admitted that Kenya markets its tea more aggressively in the UK. Cole also added that Kenyan tea is preferred in the UK over Assam tea due to its competitive pricing and flavors. Another factor behind the popularity of the Kenyan tea is its TV promos  highlighting the ‘social aspects’ involved with the tea industry of that country, he said.

Experts believe that inability of the Indian producers to work in tandem with the UK packers and provide tailor made products to the consumers, coupled with the constant pressure from the cheap Kenyan tea, has made Assam tea exports decline in the UK market.

Assam tea scores low in comparison to other classic and specialty blends, when it comes to consumers’ intentions to purchase in the UK, experts feel.

Presently, Assam tea constitutes 16.4 per cent (677,898 kg) by volume and 12.9 per cent by value of the total specialty tea market in the UK.

India’s total tea production in 2007 was 945 million kg, out of which Assam produced 480 million kg. Tea industry sources feel that the domestic market alone is not sufficient to consume the whole production. Presently, the per capita consumption of tea in India is 700 gm. Presently India is the second highest tea producing country in the world and contributes nearly 28 per cent of the total global tea production.

In 1980, India was the single largest exporter of tea, shipping nearly 40 per cent of its production overseas (224 Million Kg) and in comparison, India has fallen to the 4th position in 2007 exporting only 19 per cent of its produce (178 Million kg), well behind Kenya, Sri Lanka and now, even China.

However, a comprehensive programme has been initiated by the Central Government last year to tackle the ever growing problems faced by Indian tea in the international market where the quality of tea is concerned. The sources from the Tea Board of India said, to enhance the productivity and quality of tea, around Rs 2,500 crore has been earmarked by the Union Ministry of Commerce under the Special Purpose Tea Fund (SPTF) which is to be spent in the next 15 years for replanting and rejuvenation of tea bushes in the Assam gardens alone.

In fact, a total area of 2,12,606 hectare in the country will ultimately be covered by this programme, which was formally launched last year, with an estimated cost of Rs 4,761 crore, over 50 per cent of which is to be spent in Assam, since the State is the largest producer of tea in the country, the sources said. According to the Tea Board sources, the total area to be replanted in Assam is 98,000 hectares. The  present level of the unit cost is Rs 2,62,200 per hectare in the State, the sources said.

Tea bushes are considered to be the basic asset for the tea industry. But about 38 per cent of the tea bushes in the country have crossed the ‘economic threshold age’ of 50 years and another 9 per cent are in the age group of 40-50 years, the sources said. Beyond 50 years of age, not only the productivity of the tea bushes rapidly declines, it also becomes more susceptible to pest and diseases, which marrs the quality aspects of the green leaf.

In Assam, about 40 per cent of the tea bushes have crossed the 50-years of age, said the sources. In view of this fact and to ensure the long term competitiveness of the Indian tea in the international market a comprehensive programme has been chalked out under the SPTF for replantation and rejuvenation of tea bushes, after holding the detailed discussions among the stakeholders, including NABARD, RBI, IBA, Commercal Banks, Department of Banking, Department of Commerce and tea industry, said the sources.

The funding pattern of the scheme ensures 50 per cent bank loan, 25 per cent subsidy and the remaining 25 per cent has to be paid by the garden owner, said the sources. Resource constraint faced by the growers due to the cyclical nature of the industry has been kept in mind while chalking out the programme, it said. According to the sources, this long term programme is also expected to generate additional employment at the rate of 22 million person days per year.

According to the sources, Assam has 70 per cent (Rs 10.30 crore) of the total disbursement made as subsidy so far by the Centre under the scheme amounting Rs 14.30 crore in the very first year of the scheme. In the year 2007-2008 altogether 215 gardens covering 2,282.43 hectare in the State have been approved under the replantation scheme, said the sources. Another 84 applications from Assam have been granted for the rejuvenation under the SPTF, which is covering about 771.72 hectare.

But still, the tea industry has to wait for another one and half decades to get the much expected boost where better production and quality are concerned, when the targeted period of the ambitious scheme is completed.

Siddartha Kashyap