Closed tea estates face heat

Gardens not adhering to rehabilitation plan will be acquired.

Tea gardens that have been closed and do not avail of the commerce ministry's recently announced rehabilitation package will be acquired by the central government and handed over to other entrepreneurs.

The ministry announced the package in the first week of July for 33 tea gardens that have been closed for the past three to five years. Of these, 14 are in Kerala, 17 in West Bengal and two in Assam.

The gardens have been closed for reasons ranging from poor management practices to labour disputes. The commerce ministry says nearly 30,000 workers are dependent on these gardens.

"We will be issuing a notification, through which section 16 (d) of the Tea Act will be invoked if managements of the closed tea gardens do not take the rehabilitation package. This clause allows the central government to take over the management of a tea estate and transfer it to some other investor after conducting an inquiry into the reasons behind the closure of the garden," a commerce ministry official said.

According to Basudeb Banerjee, chairman, Tea Board of India, discussions have begun with owners of closed tea gardens on the rehabilitation package.

"We spoke with gardens in West Bengal and will be speaking with the ones in Kerala next week," he said. He says tea garden owners will be given one month to re-open their gardens.

The rehabilitation package provides for restructuring bank loans of closed tea gardens by converting them into term loans with a five-year moratorium. Recovery of outstanding converted loans will start from the sixth year and continue till the 10th.

Accumulated penal interest for the loans will be waived and the banks will charge a simple rate of interest of 11 per cent on the restructured loans. After this financial restructuring, the tea garden will be eligible for subsidy and loan from the Tea Board's Special Purpose Tea Fund.