Financial Daily from THE HINDU group of publications
Wednesday, Aug 11, 2004
Agri-Biz & Commodities
Indian tea cos woo Pak buyers
Kolkata , Aug. 10
LEADING tea companies on Tuesday displayed their best cups of tea in a bid to woo buyers from Pakistan .
At a tea-tasting session, representatives of Tata Tea, Hindustan Lever, Goodricke, Eveready, Jay Shree Tea, Warren Team AFT and several other companies displayed their products to the Pakistani buyers.
In an effort to strike deals, a seven-member Pakistani tea delegation, headed by Mr Saeed Ahmed Khawaja, Chairman, Pakistan Tea Association, is currently visiting India. The delegation is scheduled to meet the representatives of Indian Tea Association (ITA) and Tea Board.
It may be noted that though Pakistan is the third largest tea-drinking nation with an annual consumption of approximately 140 million kg. It hardly produces any tea locally. It is the second largest tea-importing nation too. During the last one year, ITA has successfully opened trade channels with Pakistan.
Indians have gradually increased their exports to Pakistan. From less than one million kg in 2001, the exports went up 6.8 million kg in 2003. In 2004, it is expected to touch the 10 million kg-mark.
Kenyans hold 65-70 per cent market share in Pakistan, which is mostly CTC-oriented.
Mr C.K. Dhanuka, Chairman of ITA, however, said they were focusing more on value rather than volume. "The Pakistanis are looking for cheaper teas and, currently, the price of Indian tea is higher than the international prices. So, we are trying to maintain last year's volume at the current year's prices," Mr Dhanuka told Business Line.
Meanwhile, in June this year, the Pakistan Government reduced import duty on tea by 10 percentage points. In effect, the total incidence on imported tea from India into Pakistan came down from 52 per cent to 28 per cent. Industry sources said that is likely to go off the tariff chart by 2006, when the SAFTA (South Asian Free Trade Agreement) comes into effect.
In May, this year, Mr Dhanuka lead an ITA delegation to Pakistan. According to Mr Sujit Patra, Joint Secretary of ITA, the association is "leaving no stone unturned" in its attempts to increase tea trade between India and Pakistan.
Tea exports this year are on the rise. Moreover, several foreign delegations have already visited India. There were two from Russia and one each from Iran, Iraq and Pakistan. Another team from Libya is expected this weekend.
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