Amidst declining tea prices, planters remain worried over low-quality imports, seek action

Kolkata: Imports of low-quality duty-free tea remain a major concern for planters, who allege that such shipments, instead of being used for re-exports, are "finding their way into the domestic market", undermining the prices of the crop and adding to growers’ woes.

They also called for the imposition of a 100 per cent import duty or a "minimum import price" to prevent such shipments from entering the country.

Tea Association of India (TAI) president Sandeep Singhania said imports of "inferior quality" tea with prices ranging from USD 1.5 to USD 1.7 (Rs 130-140) per kg are one of the contributors to the plummeting price trend and muted market sentiment.

"Duty-free imports of tea under the Advance Authorisation Scheme are supposed to be used for exports, but these are finding their way to the domestic market. This year, production so far is up by over 70 million kg. The domestic output, along with these imports, has aggravated the situation. Average tea prices are down by at least Rs 42 per kg," the TAI president told PTI.

During the January-July period this year, the country's tea production was around 641 million kg (mkg), compared to 564 mkg in the same period last year.

The Advance Authorisation Scheme allows exporters to import inputs, such as raw materials, without paying customs duty, on the condition that these will be used to manufacture products for export. The scheme is seen as a mechanism to make Indian exports competitive.

Another industry organisation, the Indian Tea Association, recently raised concern about the surge in low-cost imports - totalling 19.61 mkg during January to June this year, a 57.14 per cent increase from 2024.

During the January-June period of the current calendar year, tea imports from Kenya to India were higher by 45 per cent, Confederation of Indian Small Tea Growers' Association president Bijoy Gopal Chakraborty said.

During the first six months of 2025, imports from the African country were at "6.6 million kg, up from 4.6 million kg" in the same period of the previous year, he said.

Indian Tea Association Chairman Hemant Bangur said duty-free imports must be stopped.

"Unbridled influx of tea from Nepal has decimated the Darjeeling tea industry. It seemed that unabated imports from Kenya would hit the Assam tea sector. This needs to be stopped. There is no problem if imports are made with a 100 per cent duty," Bangur told PTI.

The problem is that there is "no reliable data about how much of the imported quantity is being re-exported and how much is leaking into the domestic market", he said.

The ITA chairman said the industry has requested the Tea Board to track the use of imported tea.

"The Tea Council, with representatives from various industry bodies as its members, is supposed to monitor imports and exports. The council has been formed, but the rules have not been notified," Bangur said.

Chakraborty said this year has been the worst in the last 10 years in terms of price realisation.

"Small growers have been compelled to sell green leaves at Rs 14-15 per kg, while we had realised Rs 30 a kg during this time last year. The market prices have crashed, resulting in a revenue loss for small growers. Cheap import of tea is one of the reasons behind the declining prices," the CISTA president told PTI.

According to an industry source, the average prices realised between the sale numbers 31 and 35 in the Guwahati, Siliguri and Kolkata auction centres have fallen sharply this year.

"In the sale number 35 at the three auction centres, the north Indian tea fetched a price of Rs 204.19 per kg this year, down from Rs 260.90 per kg in 2024. This is the highest fall among the last five sales," a Calcutta Tea Traders Association official told PTI on condition of anonymity.

However, the quantity sold between sale numbers 31 and 35 was 68.19 million kg in 2025, higher than the 57.52 million kg sold during the same period last year, he said.

Claiming that there is no preventive mechanism against duty-free imports, Singhania called for a Sri Lanka-like standard operating procedure so that such shipments entering India can be curtailed and non-compliance with food safety norms can be addressed.

"We have proposed the introduction of a minimum import price to stop the influx of cheap quality tea from the overseas market and the removal of the advance licensing scheme," he said.

Chakraborty said members of various small tea growers' organisations across the country apprised the commerce ministry officials of the situation and demanded the imposition of a 100 per cent import duty.