Tea Board inks pact with NSE for e-auction

The Tea Board of India expects to implement electronic auction, or e-auction, of tea by November 2008. It entered into an agreement with NSE.

IT, a subsidiary of the National Stock Exchange, on Thursday for starting the project in six auction centres - Kolkata, Guwahati, Siliguri, Coonoor, Kochi and Coimbatore.

The Tea Board has spent about Rs 9.5 crore on the project. Speaking on the occasion, Jairam Ramesh, minister of state for commerce, said, "E-auction will lead to better price discovery and benefit all stakeholders in the tea industry."

In 2004, e-auction for tea was introduced in the country with software from Accenture and IBM. The service was withdrawn subsequently due to technical snags.

"There are some apprehensions regarding the e-auction of tea. This time, we are not going to abolish the system due to reasons like lobbying. There will be no mandatory law regulating tea auction. We want the system to work in a manner to create an incentive for people to participate," he said, adding, "IBM and Accenture had not done their homework when the system was launched earlier and hence the system-design was faulty."