Despite the global financial crisis and depreciating rupee hurting exporters, tea exports will remain robust and is expected to touch 210 million kilograms (mn kg) during 2008-09 on the back of rising exports to non-traditional tea markets.
Speaking on the sidelines of the launch of the new e-auction system for tea in Kolkata, Jairam Ramesh, Union minister of state for commerce and industries said, “We have done relatively well on the export front and there are a couple of success stories this year to boost exports. Our expectation before the economic crisis hit, was to achieve a net export of 210mn kg. Average net export has never crossed 185mn kg. Price value had also increased substantially by almost Rs18-19 per kg with the average hovering at around Rs 90 per kg. Taking everything into consideration even under the most pessimistic scenario I do not see net exports falling below 200mn kg in 2008-09 fiscal.”
The minister pointed out that the four new markets identified - Egypt, Iraq, Iran and Pakistan- were doing well besides export to the traditional markets of Russia and United Kingdom and UAE.
To substantiate, the minister pointed out that exports to Egypt had done very well this fiscal.
India had not done more than 3-4mn kg there in the past couple of years. However, industry and the major tea exporters to Egypt feel that tea exports could cross 20mn kg in the calendar year 2008, said the minister.
The Iraq market till two years ago was the top market with 44mn kg to Iraq. Iraq collapsed last year and India exported hardly anything. Iraq market recovered this year and India would be expecting to touch 20mn kg export figure to Iraq this fiscal, he added.
He also pointed out that India's export to Iran was also expected to double to 8-10mn kg in the next fiscal.
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Tea exports to Iran hovered around 4-5mn kg and was expected to double to 8-10mn kg after a high level delegation led by minister of external affairs, Pranab Mukherjee, and signed a joint statement to boost tea exports from India last month, he added.
The impact if at all would be felt next year, as major buying has happened already and this year tea exports would not be impacted, claimed Basudeb Banerjee, chairman, Tea Board of India. In addition, India was looking at a rise in tea exports to Pakistan as it was two years ago.
Pakistan, a highly price sensitive market, was dominated by Kenya tea.
In the last few years Indian tea exports to Pakistan were 10-11mn kg and this year it could be 16mn kg, said the minister.
Ramesh was scheduled to visit Pakistan soon with Basudeb Bannerjee, chairman of Tea Board, in response to an invitation from Pakistan Tea Association, accompanied by members of Indian Tea Association and UPASI. Tea exporters were looking at tapping the non-traditional US tea market, especially the untapped speciality tea segment, said Banerjee.