The Indian tea industry is seeking the Centre’s support to help it fight climate change, which is affecting crop. The common ground between the large estates and the small tea growers – now an emerging force in the Indian tea industry seems to be the sops that they are seeking from the government, for supporting farm practices which have now become necessary for combating climate change.
Even as the small tea-growers carve out an increasing share in India’s total crop they have begun urging the Centre to adopt a more farm-centric approach which they feel will help the small tea growers most of whom grow tea on less than an acre.
“They are essentially farmers and they need schemes to protect them from the impact of climate change and resultant crop loss... we strongly urge the government of India to implement crop insurance schemes and invest in preparing farmers to face,” the Confederation of Indian Small Tea Growers Association said in its representation to the Centre.
As erratic climate continues to affect output the industry is focus is on creating irrigation facilities and on replanting the old tea bushes. Almost 38 % of the area under cultivation comprises tea bushes which are over 50 years old. Around 9 to 10 % each belong to the category 11 to 49 years, while 26 % is 10 year old bushes. The age of a bush is directly linked with yield. Industry gets support for its investment in this regard through income tax deductions. With a floor limit of ₹25 crores. It feels that this limit should be remove d so as to enable investment in plant and machinery for irrigation according to the industry needs.
It said that the small tea farmers face heavy crop loss due to recurring instances of hailstorms, frost, rains and droughts , especially so in the absence of any system to compensate the farmers. “We strongly urge the government to implement crop insurance schemes and invest in measures that would prepare farers to face the challenge of climate change. It also wanted the government to declare minimum support price for green tea leaf produced by small tea growers.
According to Tea Board, the small tea growers accounted for 44% of the 1250.5 million kgs tea crop in 2016-17.
The organised tea industry which feels weighed down by its social costs (mandated under the Plantation Labour Act and covering areas like housing, medical, potable water and subsidised rations), is also keen to see some IT relief for these expenses. Customs duty on specified machinery was 5 % in 2003 and through yearly extensions continued at this level till 2011. They say that the moderate increases in price do not cover rise in inputs costs.
In respect of GST, the industry has sought some simplification and removal of anomalies which is affecting exporters. It also wants Income Tax laws to be synchronised with the new accounting standards like IND AS.
However the industry is not too hopeful on the budget wish fulfilment front . Available statistics show that against a ₹1425 crore approvedl for the tea industry during the 12th plan ( 2012 -2017) only around RS 705 crore was release till March 2017. Now the funding is continuing through mid term releases.
On the value-added export front (tea bags), industry is looking for concessional duty on filter paper, multiwall paper and nylon cloth which is required for making tea bags. “ These products are either not available in the domestic market or of poor quality. Total duty incidence on these papers is very high making India uncompetitive,” industry said .
