‘No plans to revise import duty’

The government has no plans to revise the import duty on tea in the near future, minister of state for commerce and industry Jyotiraditya Scindia said on Wednesday.

A section of the Indian tea industry has been demanding that the import duty on tea currently pegged at 100% should be reviewed in the light of massive influx of cheaper tea varieties from Vietnam and Nepal at the cost of Indian tea. “We have no plans to bring down the duty on tea import. Not currently,” Scindia said during his inaugural address at the 19th Session of Inter-governmental Group (IGG).

Clarifying the government’s stand, the minister added, “Tea production is improving. So are prices. The production is going to touch the threshold of 1 billion kg this season.”

On rebranding of Indian tea to make it more acceptable to foreign customers, the minister said a task force has been set up—of which he is the head—to provide ‘pragmatic solutions’ to the hurdles faced by the sector.

“Making tea suppliers capable of matching the global standards in the domestic and world market is essential,” Scindia said, adding that there is an urgent need to augment domestic production to compete in the world trade .

“There are lots of supply side constraints which we are trying to address through the Special Purpose Tea Fund. We are urging the industry to take up the replantation so that India could regain its number one position,” the minister said.

Scindia also discounted talk that the global economic crisis had any impact on Indian tea exports last year. “Despite the recession, tea export has been consistent and the government congratulates the industry for that,” the minister said.

India is the world's largest tea grower. It produced 960 million kg of tea in 2009-10 and exported close to 200 million kg, up from 190 million kg in 2008-09. “The government has raised the budget allocation for tea sector to Rs 800 crore in the Eleventh Plan from Rs 350 crore,” he added.

Source: Financial Express