Industry body hails Assam’s budgetary provisions for its tea sector


The Tea Association of India hailed budgetary provisions and announcements made in the Assam budget 2023-24 and said it was strong on capital expenditure, focus on long-term sustainability and will provide a fillip for the tea industry in all sphere.

“The Budget proposals earmarked for the Tea industry of Assam catered to the financial well-being of the Industry and take a 360 dgree approach to all facets of the Industry’s workings,” the association said in a release.

“Tea Association of India along with the entire Tea industry hereby lauds the Govt. of Assam for the most progressive and forward-looking Budget for the Tea industry in Assam.”

Assam is all set to kickstart a year-long celebration of its tea industry reaching a crucial milestone of 200 years. Tea bushes were first discovered in the state way back in 1823. Assam now produces nearly 700 million kg of tea annually and accounts for around half of India’s overall tea production.

Renowned globally for its richly coloured and aromatic tea, Assam’s tea industry, which is the country’s largest, provides livelihoods to millions with many others directly or indirectly dependent on the plantations. The state is famed for both Orthodox as well as the CTC (Crush, Tear, Curl) varieties of tea.

For nearly two centuries, the tea sector has been the backbone of the state’s economy and employment generation point of view, as a substantial part of its populace depends on the tea. Tea constitutes close to 90 per cent of the state’s exports.

“Our Government wishes to celebrate 200 years of Assam tea, which coincides with year 2023, in a grand manner. We propose to organize road shows in major cities across the country as well as abroad to promote Assam Tea as a brand and showcase the rich socio-cultural heritage of tea garden communities,” Assam finance minister said in her Budget speech earlier this week.

The state announced several initiatives and incentives both for tea growers and workers.

Under Assam Tea Industries Special Incentives Scheme (ATISIS), it proposed to increase in the production subsidy for orthodox and speciality tea from Rs 7 to Rs 10 per kg. For 2023-24 when the state is celebrating the 200 years of Assam Tea, the incentive would, however, be Rs 12 per kg.

The state proposed to extend tax holiday on Agricultural Income Tax for a period of next three years. Also, as a special relief, all the arrear electricity dues of tea garden worker families living in the tea estate lines will be waived off as a one-time measure, for which Rs 150 crore has been earmarked.

Under the Wage Compensation Scheme for Pregnant Women of Tea Garden Areas of Assam, the compensation amount will be enhanced to Rs 15,000 from the existing Rs 12,000. Under Mukhya Mantri Awaas Yojana, 10,000 houses will only be constructed in tea garden labour lines.

India as a whole contributes 23 per cent to the global tea output and employs around 1.2 million workers in the tea plantation sector.

But everything is not ideal, and the industry continues to operate with several perennial issues.

For several years now, India’s tea industry has been struggling with issues such as rising production costs, relatively stagnant consumption, subdued prices and crop losses due to climate change. It also faces the challenge of finding a footing and holding its ground in a competitive global market. The tea business is cost-intensive, with 60-70 per cent of the total investment being fixed cost.