New foreign trade policy expected to boost Indian tea exports

Silliguri, Sep 1 (ANI): Tea exporters in Siliguri are upbeat, as the new provision bringing the tea industry under the Vishesh Krishi Upaj Yojana (VKUY) scheme in the new foreign trade policy, is expected to give a boost to its export in the global market.

As per the VKUY scheme, the export of tea will be eligible for duty scrip equivalent to five percent of FOB (freight on board) value.ea exporters said this will help them import capital goods and will facilitate value addition.

"Suppose we have sent tea worth some rupees, previously it (duty scrip equivalent) used to be 4 percent now it will be five percent, which will be given in the form of a certificate, which you can easily trade, or you can import certain capital goods, capital goods means better machinery. We can now import machinery from Europe," said Rajib Lochan, tea exporter, Siliguri.

The new trade policy also reduces the minimum value addition under advance authorisation scheme for tea exports from 100 per cent to 50 per cent, while the DTA (domestic tariff area) sale limit of instant tea by EOU (export oriented units) will be increased from 30 per cent to 50 per cent.

Tea exporters have expressed happiness as they feel that the scheme would help to achieve the target of 200 million kilograms of export every year.

"This is a very good move on part of the government especially at the time when our tea exports are taking a fall due to global recession," said Ravi Agarwal, another exporter.

India's tea exports had reportedly fell 19 percent in volume in January-May, as firm domestic demand and low internal production weighed. Total exports during January-May were 60.03 million kg compared with 73.67 million kg.

India exports CTC (crush-tear-curl) tea mainly to Egypt, Pakistan and the UK and the premium orthodox tea to Iraq, Iran and Russia.

India, China, Sri Lanka, Indonesia and Kenya together produce 75 percent of the total global output. (ANI)