Kolkata, Nov. 10 -- Five tea industry associations have welcomed a Tea Board of India committee's recommendation to introduce a Minimum Sustainable Price (MSP) for tea, saying it could address rising production costs and improve growers' returns.
A 10-member committee constituted by the Tea Board has proposed the framework. Tea prices have recorded a compound annual growth rate of around 2-3 per cent, compared with an estimated 10-14 per cent rise in input costs.
The Indian Tea Association (ITA), Tea Association of India (TAI), United Planters' Association of Southern India (UPASI), Confederation of Indian Small Tea Growers Associations (CISTA) and Federation of Indian Tea Manufacturers Association (FITMA) welcomed the recommendation at a Kolkata press conference on Tuesday.
The committee has proposed a composite index reflecting wage movements and the Consumer Price Index (CPI) to determine the benchmark MSP, with periodic reviews to account for production costs and inflation. The recommendation assumes significance as employment costs account for approximately 60 percent of tea production costs. Producers anticipate higher wage bills following notification of floor wages under the Code on Wages.
Industry representatives said the framework could support stable green-leaf prices for small tea growers, who contribute nearly 55 per cent of India's tea production. They said regional differences in production costs must be recognised.
ITA chairman Suneel Singh Sikand said remunerative returns were essential to sustain operations and encourage investment in replantation and productivity. The associations urged the Union Commerce Ministry to consider the recommendations favourably and notify the MSP at the earliest.
Published by HT Digital Content Services with permission from Millennium Post.