The Hindu : Business : Small tea growers form umbrella association

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Friday, Dec 21, 2007
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Small tea growers form umbrella association

Indrani Dutta

The move will give more lobbying power for STGs

Small growers may be given pattas
Tea Board to fund census of STGs

KOLKATA: Small tea growers (STGs) in the country, who contribute 20 per cent of the annual production, have got together for the first time to form an apex body — the Confederation of Indian Small Tea Growers Association (CISTA).

The move is aimed at giving more lobbying power to the STGs who face many forms of exploitation, mainly due to their unorganised existence which reduces their bargaining power.

One of the main aims of CISTA is to enhance quality of production by the STGs by enabling and empowering them with input and technical trainings and resource support.

Commenting on the development, Union Minister of State for Commerce, Jairam Ramesh, said his department would encourage such a move. “I see small tea growers as a great social force since they represent first generation local entrepreneurship in the tea industry,” he said.

Formation of an apex body would help dovetail the STGs into the national agenda of the Indian tea industry, he said. It may be mentioned that two of India’s main competitors in the international arena, Kenya and Sri Lanka, have strong institutional framework for development of small tea holdings which contribute 62 per cent of the total production.

At a time when major corporates are looking for ways to divest or dilute their tea interests, the STGs role gains importance, especially since their cost of operations are low (as they are out of the purview of the Plantation Labour Act and hence do not have any social costs), industry sources said.

At present, estates of less than 25 acres are regarded as small holdings. While 39 per cent of the gardens in Assam, India’s largest tea-producing State, is small, Tamil Nadu follows with 34 per cent of small gardens. In North Bengal, 24 per cent of the holdings are small while it is 10 per cent in Kerala.

However, despite their cost advantage, the downward pressure on prices has affected the STGs, most of whom do not have any processing facilities and are forced to supply their teas to the bought-leaf factories and get poor prices for their green leaf on account of both quality and intermediaries’ margins.

Since only 10 per cent of STGs are registered with the Tea Board, they do not get any institutional finance although a number of schemes are available for giving subsidies and grants to this sector.

Mr. Ramesh said he had written to the chief ministers of the respective States to give pattas or some form of possessions certificates to the STGs so that they could avail themselves of the Tea Board schemes and bank loans.

The Tea Board is planning to fund a census of STGs which will be conducted by the state governments.

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