Industry stakeholders think this will help not only in increasing per capita consumption of tea in the domestic market, but also in increasing the exports volume of Indian tea
From a ‘regular drink for all’ to an ‘aspirational consumption experience’, Indian tea seems well set to set out on a new journey. At least that’s what the Tea Association of India is attempting to do.
“We had been marketing tea as a cheap drink. From this to making it a drink or an experience that makes it aspirational, attracting the youth and old alike, will need an image makeover, and a sustained, well-planned generic promotion. The tea board, as the custodian of the Indian tea brand could own and lead this effort, while involving the different links in the supply chain as stakeholders,” said Mudit Kumar, president of Tea Association of India, recently.
The whole idea is to increase the per capita consumption of tea in the country. With this goal, TAI is promoting tea as a ‘healthy’, ‘cool’ and ‘aspirational’ drink in various social media amongst the target group and in a cost effective manner. Tea industry stakeholders think that this will not only help in increasing per capita consumption of tea in the domestic market, but will also help increasing the exports volume of Indian tea.
Significantly, this initiative coincides with the present government’s plans of achieving the target of exporting 300 million kg tea by 2020 with the support of industry and stakeholders. Union commerce and industry ministry’s joint secretary (plantations) Praveen Bonigala recently interacted with the exporters to gather first-hand knowledge about tea export scenario and to ensure greater cooperation among the industry members and the government officials. Bonigala said after the meeting that this target is highly achievable. He raked up the issues related to quality standards of tea, sanitary measures, issues related to pesticide residue, non-tariff barriers and creation of infrastructure facilities by the government on PPP mode to help exporters. Interestingly, total tea exported out of India during fiscal 2017-18 stood at 256.57 million kg.
The good news is that such measures are initiated when India’s tea exports to Iran look set for a revival. Tea planters in India said they’ve started receiving purchase enquiries from Iran, a development that could potentially reverse the slowdown seen last year in tea shipments to the West Asian nation due to uncertainty over US oil sanctions. The US administration late last year decided to exempt India from Iran oil sanctions.
This, in turn, will certainly heighten competition with Sri Lanka, which is a major exporter of orthodox teas to Iran, which normally buys second flush orthodox tea from India. It may be mentioned here that Iran consumes nearly 5 per cent of the total world tea production. Although Iran has its own tea plantations, it also imports tea, mainly from India, Sri Lanka and Kenya. The country as a whole consumes nearly 1,05,000 tonne of tea every year, of which about a quarter is supplied by domestic producers.
Interestingly, India, on its parts, produces 80-100 million kg of orthodox teas every year. Orthodox teas are whole leaf teas manufactured using a traditional process. Between January and November last year, India has exported 27.26 million kg of orthodox teas, worth Rs 671.69 crore, to Iran. If things move the way it has been envisaged, the renewed interest of Iran to buy more orthodox teas from India is likely to make the Indian planters shift a portion of their CTC production to orthodox teas, analysts said.
Indian tea exports till November 2018 is likely to be in the region of 260 mkgs (million kilograms) compared to 252 mkgs in 2017. The foreign revenue earning has also increased to Rs 4624.34 crore from Rs 4478.24 crore last year. The CIS (commonwealth of independent states, an alliance of former soviet republics) countries, Russia, Iran, Egypt comprise the main destinations for Indian teas but the uncertainty hovering over the method of payment in the export of orthodox teas to Iran had shown a sharp dip during the months of July to October.