New foreign trade policy disappoints tea sector
3 Apr 2015
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EOI, KOLKATA, 2 Apr 2015: The tea industry has expressed disappointment over reduction in export benefits for tea in Foreign Trade Policy 2015 - 2020.
Government has replaced Vishesh Krishi Gram Udyog Yojana (VKGUY) with Merchandise Exports from India Scheme (MEIS) in the new policy which directly impacts organic tea exporters, Darjeeling Tea Association chairman S S Bagaria told PTI.
The government instead boosting the sector has made tea exports more uncompetitive in the global market at a time when unfavourable forex movement in the Euro had hit hard.
Tea producers body Indian Tea Association (ITA) had also expressed disappointment.
"Under the MEIS the benefit stand reduced from 5 per cent to 3 per cent in respect of bulk teas which will adversely impact the competitiveness of tea in global markets," ITA said in a statement. Bulk tea constitutes around 90 per cent of total tea exports.
Tea had been earlier included in the Vishesh Krishi Gram Udyog Yojana (VKGUY) and had been enjoying 5 per cent benefit for non-organic and seven per cent for organic tea covering both bulk and value-added teas.
Indian tea exports continue to be under severe strain. Tea Board’s latest data for the period April-January of 2014-15 recorded a decline of nearly 28 million kgs from that of the corresponding period of 2013-14.
This decline has largely been in the wake of increased competition from lower cost tea producers such as East African countries, ITA sources said.
The government instead boosting the sector has made tea exports more uncompetitive in the global market at a time when unfavourable forex movement in the Euro had hit hard.
Tea producers body Indian Tea Association (ITA) had also expressed disappointment.
"Under the MEIS the benefit stand reduced from 5 per cent to 3 per cent in respect of bulk teas which will adversely impact the competitiveness of tea in global markets," ITA said in a statement. Bulk tea constitutes around 90 per cent of total tea exports.
Tea had been earlier included in the Vishesh Krishi Gram Udyog Yojana (VKGUY) and had been enjoying 5 per cent benefit for non-organic and seven per cent for organic tea covering both bulk and value-added teas.
Indian tea exports continue to be under severe strain. Tea Board’s latest data for the period April-January of 2014-15 recorded a decline of nearly 28 million kgs from that of the corresponding period of 2013-14.
This decline has largely been in the wake of increased competition from lower cost tea producers such as East African countries, ITA sources said.
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