Hard Currency Rift Declines Indian Tea Export

The Tea Board of India on Tuesday warned the country that hard currency rifts between New Delhi and Tehran threatens India's export of tea to Iran.

In its latest report, the council announced that the level of export of India's tea in the fiscal year 2010-2011 will reduce by over 10 million kilograms.

Deputy chairman of the board, Roshni Sen, said decline in production is the reason behind the decrease in its export.

It is predicted that this year, India's export of tea will decrease between 8 million kilograms to 10 million kilograms, Fars News Agency reported.

Heavy rainfalls in northern India have adversely affected the quality of tea production in the country. Therefore, it is forecast that India's tea production would amount to 969 million kilograms only this year. Some 70 percent of tea plantations of India are situated in the northern region of the country.

Sen also said, "Although the production of tea in southern India has increased, growth of this production level is not enough to counter reduction of production in the north."

She also said restrictions imposed on trade ties with Iran are another important factor for reduction of India's export of tea.

India exports tea to Egypt, Russia, Iran and Pakistan. Reduction in India's tea export will leave a large impact on the global tea market.

She recalled that at present her country focuses on markets in Russia, Kazakhstan, Iran, Egypt and America, but it also seeks to expand export of tea to Singapore and South American countries. Germany and Japan have also called for importing high quality Indian tea.

The domestic demand for tea in India grows by up to three percent per annum. India uses some 80 percent of its tea production for domestic purposes.

India's crude oil imports from Iran faced an impasse after the Reserve Bank of India declared that a regional clearinghouse that involved the Iranian central bank could no longer be used to settle oil and gas transactions between the two countries.

Indian oil industry officials are keenly awaiting a solution as India imports 80 percent of the 184 million tons of crude oil it refines every year, and Iran accounts for 16 percent of these purchases, making it the second-biggest supplier, after Saudi Arabia, Economic Times reported. The dispute has not yet been resolved.

© Iran Daily 2011