Discuss the trends, scope and challenges of India's Tea exports.
Hint: India exports around 20% of its tea produced and accounts for roughly 13% of Total World Trade in Tea. Currently, India is fourth largest exporter of tea after Kenya, Sri Lanka and China.
India’s Assam CTC Tea faces competition from Kenya while orthodox tea faces competition from Sri Lanka & Mozambique. Since qualities are similar, it’s the price and production which matter in exports.
Further, most of the tea (≈90%) exported from India is bulk tea (other is value added tea). Both bulk tea and value added tea earlier enjoyed 5% benefit by their inclusion in the Vishesh Krishi Gram Udyog Yojana. However, later bulk tea was included in the Merchandise Exports from India Scheme, whereby the export benefit was reduced to 3%.
This is one factor that adversely affects the competitiveness of tea industry.
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