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Wednesday, August 29, 2007

Ninety million dollar investment in Ethiopian tea

The Kanan Devan Hills Plantations (KDHP), an Indian company, says it will invest more than 90 million dollars (N11.5 billion ) in Ethiopia to develop 10.000 hectares of tea plantation.

Commodity Online reports from India that KDHP officials said while the new project would have a 70:30 debt equity ratio, some foreign private companies have shown interest in the venture.

The participation of Tata Tea, which already holds 20 per cent equity in KDHP, would also be sought.

The debt component would be raised from Ethiopian banks, which have also shown interest in the project.

The aerial survey of the land have been completed along with queries on the employment and economic generation potential of the project.

According to KDHP officials, the project would create direct employment for close to 10,000 people and accelerate export and economic development in the region.

The land, which is given on a 90-year lease, will command a very nominal rent.

The suitability of the land is attested to by its proximity to Kenya and Tanzania, which are traditional tea growing countries.

The company is in the process of preparing a detailed project report.

KDHP succeeded Tata Tea Limited on April 1, 2005 when the latter exited most of its plantations in Munnar, to focus on the growth of its branded tea business.

Source: The Tide Online

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Plantation Labor Act for major changes

The Plantation labor Act 1951 is set for major changes. The inter-ministerial and intra-ministerial review committees formed by the Union ministry of commerce & industry and the labor ministry respectively, have narrowed in on the desired changes and the amendment bill is expected to come up in the Winter Session of the Parliament.

One of the proposed changes in the PL Act that enjoys the consent of both the review committees, is in the definition of "employer" with regard to the plantation industries. As of now, in the PL Act terminology, "employer" refers to one in command of the affairs of a plantation, practically the manager of a tea estate.

It has been proposed that the term "employer" be modified to include the lessee, partners and MD of a plantation in its ambit, as the manager is often a paid staff and not a owner.

"The proposed change, which would definitely sail through, would be a major step towards protecting the interests of plantation workers. For, the estate owners would not be able to shift the responsibility on managers and thus would become accountable to the workforce," said Mr Aloke Chakravorty, the workers' representative in the Union commerce & industry ministry's review committee.

The other major changes proposed are, extension of the employees' state insurance facility to the plantation workers, inclusion of contract workers in the scope of plantation workers by raising the wage ceiling to Rs 6,500 per month and inclusion of a widow sister in the scope of family of a plantation worker.

The commerce & industry ministry review committee, headed by Mr OP Arya, additional secretary in the ministry of commerce, has met five times so far to formulate the proposed amendments. Another crucial meeting of the review committee is scheduled tomorrow at Udyog Bhawan in New Delhi, which is likely to come up with the final draft proposal for the much-awaited amendment to the Plantation labor Act 1951.

Source: The Statesman

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Tuesday, August 28, 2007

Tea worker starvation deaths

Kalavati Barai of Raipur Tea Estate in Jalpaiguri has been watching the consistent deterioration of her family of six over the past four years. In March this year, her husband succumbed to severe anaemia and related complications. “I couldn’t feed him, so he died,” she states simply. Since the tea garden was abandoned by its owners in 2003, they have been subsisting largely on one meal of rice a day. Kalavati’s youngest son, 13-year-old Kartik, is now severely ill but she can’t afford his medicines. “He hasn’t been to school for three years now. The doctor says his kidney is damaged. What do I give him? I have nothing.” There are several others like her who are suffering because of closure of 14 tea gardens in North Bengal in 2003-04.

Most of the gardens closed after production fell and profits plummeted due to low yields from ageing tea bushes. Several gardens were abandoned by their owners, leaving behind large debts and dues of Rs 18. 69 crore in workers’ provident funds. More than 17,000 workers at these tea estates have been struggling; there are no other means of livelihood. An estimated 1,000 people—workers and family members—have died of malnutrition and related diseases since 2003 in the Dooars region.

The governor of the state, Gopal Gandhi, expressed shock four months ago at the dire situation of tea estate workers. The media in the state has regularly covered the workers’ plight, leading to red faces in the Left Front government of West Bengal as well as the Centre. The much-awaited response came on July 7 from the Tea Board of India, the Union ministry of commerce’s regulatory body on tea trade: an ultimatum to the 14 estate owners to reopen the plantations within a month, failing which the Centre would take over their estates and hand them over to new owners. The estate owners have until mid-August to respond to this ultimatum. Talks between government and tea industry officials also produced a package of Rs 119 crore to revive the tea industry. A senior tea board official said the package in June 2007, includes:

  • a five-year moratorium on damages for defaulting on provident fund and gratuity payments
  • waiver of all loans from the tea board and soft loans for five or six year terms to help with replantation
  • rejuvenation of old tea bushes
Surviving on rats
“No other organised sector has seen so many deaths from chronic malnutrition before,” says Anuradha Talwar of the West Bengal Network for Right to Food and Work, which has estimated the death count of 1,000 in its study. It found workers were eating wild grass, leaves and rats to survive. A survey by Paschim Banga Khet Mazdoor Samiti, a farm workers’ union, found the workers surviving on as little as 200 calories per day, compared to 1,000-2,900 calories before the estates closed down. An average adult is believed to require at least 850 calories per day.

The state government denies that food scarcity is responsible for the deaths; it did acknowledge in June that 571 people had died at the gardens between January 2006 and March 2007. The state health department had a long cause list for the deaths. It included tuberculosis, meningitis, cancer, malaria, hepatitis and septicaemia. It did not mention what is common knowledge: lack of nutrition makes the sick more vulnerable. Forty-six of those who died were children below the age of 10, and 465 died at home, unable to afford trips to a healthcare facility.

The media outcry led to the administration and several ngos distributing food and medicines, and conducting health camps in badly hit estates like Ramjhora and Bharnobari in Siliguri. Debashis Chakrobarty of Siliguri Welfare Organisation, a voluntary health service outfit, said the efforts are vastly inadequate.

In April, the state had announced a special interim grant of Rs 16 crore for the closed gardens as a stopgap solution while negotiations were going on. Media reports claimed little of this has reached the workers.

Most of the affected gardens are far from towns and villages, limiting employment options and healthcare services for the unskilled workers. Public transport to towns is infrequent and expensive—it costs Rs 60 for a 30-km bus trip to Jalpaiguri town from Raipur. The Plantation Labour Act of 1951 makes it the estate owners’ responsibility to provide the workers basic needs—food, education, healthcare. With the tea estates becoming unprofitable after the late 1990s, the owners abandoned their responsibility.

Ownership crises
Most estates are now run by ad hoc management committees set up by local trade unions. “We depend entirely on nature now,” says Kajal Ghosh, a former supervisor at Raipur tea estate, now helping out the committee. “December-March is the lean period when plucking is stopped, to start again in April. Things are a little better during the monsoon, and we can pay regular wages.”

The committees lack the expertise to run the processing plants, which can’t run anyway after the water and power connections were cut due to unpaid dues. So, the picked tea leaves are sold to the processing factories that have cropped up in the region. The day’s earnings are divided up among the workers. With no resources to spend on protection of the tea bushes, output is low. Workers pick about 3-4 kg of leaves per person per day, which was 10-12 kg earlier. The daily earnings vary from Rs 5-10 to nothing a day. Then, there are allegations against the committees, too. At the Kalchini Tea Estate in Jalpaiguri, the committee members have been accused of embezzling funds.

Compromised from all sides, workers are forced to sell household items, or crush stones in nearby riverbeds for daily wages. There are also occasional jobs of digging drains and widening roads under the National Rural Employment Guarantee Act (nrega). Officials claim the state government is carrying out several work-for-food schemes and distributing food for the children and the aged.

But the effectiveness of these schemes is questioned. A National Legal Services Authority report submitted to the prime minister and the chief justice says there is “rank mismanagement in distribution of job cards, pensions and the 100-day work scheme”. It says the workers’ are going hungry because of unemployment, absence of alternative income opportunities and limited access to social justice schemes.

Estate employees such as Ghosh have repeatedly suggested nrega funds would be better utilised to on running the gardens instead of peripheral development work. At Dehklapara Tea Estate near the Indo-Bhutanese border, also closed since 2003, an emaciated Rita Sonal has been given a job under nrega: cutting hard mud with a spade and loading it on to trucks. Though glad to have a job, Sonal has a hard time. “We don’t have strength left in our bodies for this kind of heavy work,” she says.

A troubled brew
The first wave of tea garden closures in North Bengal began in the late 1990s after managements shut down operations citing poor economic viability. There are an estimated 160 tea plantations in North Bengal, which account for about 30 per cent of India’s annual tea production of about 823 million kg. India is the world’s largest tea producer, but industry insiders say its us $1.5 billion a year tea business has been suffering over the past decade following a crash in tea auction prices and a slump in leaf exports.

According to a status paper by the Tea Association of India, declining productivity, rising input costs, low level of labour output and age profile of tea bushes contributed most to the decline of the industry. The North Bengal gardens, whose leaves were once considered among the best in the country, have been the worst hit.

Some garden owners, like Robin Pal of the Redbank group in Jalpaiguri, blame trade unions for the crisis, saying they made impossible demands regarding wages and benefits at a time when business was suffering. But others, like Sanjay Bansal of the Ambootia group point to other reasons: bad management practices, owners siphoning off money instead of investing it in the gardens, overuse of pesticides and indisciplined workers.

The other cause for decline is the proliferation of small growers and ‘bought leaf’ factories since the 1980s, says Naba Dutta of Nagrik Mancha, a Kolkata-based citizen’s group that investigates labour issues. According to government records, there are 6,000 small tea growers in Bengal (though the United Forum of Small Tea Growers’ Association pegs it at 15,000). These gardens, industry watchers say, has done more harm than good for the local tea business. They are run by businessmen interested only in quick profits, who don’t know the specifics of tea growing and don’t concern themselves much with quality control. As a result, the industry’s reputation has suffered. Both Dutta and Bansal believe the situation can be corrected by recognising that the bought leaf sector is the nemesis of the tea industry, work on making the soil healthy again, and by treating workers as assets.

Dutta goes a step further and insists that though there’s a general idea that the entire tea industry in the country is ailing, nothing could be further from the truth. “A simple example – the price of tea hasn’t reduced in the domestic market,” he says. “Tea garden owners say that the market is fallen, consumption is decreasing, that young generation is drinking cold drinks, but a recent Indian Institute of Management, Kolkata, study has projected total domestic consumption of tea has increased from 737.13 million kg in 2006 to 789.49 million kg in 2007,” he says. The study projects consumption will increase further to 867 million kg by 2009. Also, only 30 per cent of tea produced comes to auction houses on which accounting of a garden’s profit is measured, so can never really know the actual profit/loss margin, he says. Dutta believes the current crisis developed because many garden owners are using their estates to take out huge loans and invest the money in other businesses rather than in the upkeep of the gardens and the workforce. Nagrik Mancha and several civil and labour rights’ groups are conducting an independent study into the “real cause” of the garden closures.

Ethnicity of the workers has also been a crucial reason why this abysmal situation has been allowed to drag on for so long, human rights activists allege. More than 85 per cent of the workers are tribals—fourth generation immigrants of migrants brought in by the British from Jharkhand, Bihar and Chhattisgarh or low-caste refugees from Bangladesh’s Jassore, Khulna and Barishal regions. A largely marginalised group, they lack the education or organisation to fight for their rights. Even when the estates are open, their daily cash wage is about Rs 48 and their standard of living is pathetically low. The trade unions, that purport to fight for their rights, have been so busy fighting among themselves and with the management, that they’ve paid scant attention to ensuring relief measures for workers at the closed gardens.

But anger at the injustice done to them is slowly building up among workers.

At Dehklapara Tea Estate, Dharamveer Bikuda, a young worker, threatens that if no action is taken soon, he and his friends will start blocking roads and robbing rich people driving by in cars. “We can’t go hungry for ever,” he says.

By Maureen Nandini Mitra
Source: Down To Earth

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Tea meet apprehensions

Guwahati , Assam : The Assam Tea Tribes Students Association has expressed apprehensions that the International Tea Convention, slated to be held in November, could end up doing more harm than good for the image of the state as well as the tea industry.

“When foreign delegates visit tea gardens — as they are scheduled to do — they will see for themselves the unhygienic living conditions of the tea garden laborers. This will not only give Assam a bad name, it might even have an adverse impact on business,” association general secretary Pallab Das said.

He pointed out that many developed countries just might not want to buy tea from a place where laborers lived and worked in such unhygienic conditions.

“These countries are very sensitive to such issues,” he argued, adding that given the tough competition faced by Indian tea in the international market, projection of such an image could very well ring the death knell for the industry.

Assam will host the International Tea Convention for the first time this year. The four-day convention will be held simultaneously in Guwahati and Jorhat.

A host of foreign delegates is expected to participate in the event. Hollywood actress Julie Christie, who was born in a tea estate in Assam, will be the guest of honor.

Source: The Telegraph

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Saturday, August 25, 2007

Ceylon teas in Bangalore

Bangalore : Our island neighbour of Sri Lanka is known for its top quality tea and one of its best known brands, Hyson Tea, has come to Bangalore. Twelve different flavours of tea will be distributed by Lekkad Exports and Events Pvt. Ltd across the country. At the media launch of Hyson Tea here on Friday, Hyson Tea Marketing Manager Sahampathy Dissanayake said his brand has a wide range of value added products to every taste, culture, mood and moment. Hyson Teas Pvt., Ltd., has been exporting Ceylon tea to over 25 countries, he added.

Mr. Dissanayake said that Hyson’s team of professionals and dynamic tea traders possess a collective experience of many years in international tea testing, blending, grading and trading. The tea comes in diverse forms of packets, tea bags, metal tins, gift items and canisters containing a variety of black and green teas ranging from regular, flavoured, fruit, specialty blends, herbal, cocktail and liquor teas.

Lekkad Director Sagar Lekkad said initially they would import Hyson tea in teabags (of two gram each) and their target would be major corporate houses. Later, they would also import loose tea, he added. The official launch will take place on Saturday with the Union Minister of State for Planning M.V. Rajashekharan releasing the Hyson tea products.

Source: The Hindu

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Friday, August 24, 2007

Tea to get e-auctions soon

Kochi : Soon, e-auction will be introduced in tea, chilli and tobacco. Inaugurating the country’s first e-auction in cardamom at Bodinaikkanur on Thursday, Union minister of state for commerce Jairam Ramesh said e-auction in tea will begin in September. The Spices Board will take care of the e-auction in chilli, he said.

He said e-auction in cardamom would help in stabilising prices and improve the financial conditions of farmers. The present system of payment to the farmers on 21st day by the auction centres will be changed to payment in 14 days, for which auction rules will be amended by the Spices Board. All farmers will also be given identity cards, he said.

The e-auction centre in Bodinaikkanur will be a standalone system with a local area networking of auction centres. The Spices Board will extend the e-auction facility to the other existing auction centres in Kerala.

Mr Ramesh said a Rs 2-crore facility will be set up for cardamom processing and grading in Bodinaikkanur to ensure clean and graded spices. He also said that the commerce ministry will set up spice parks for turmeric in Erode, for cardamom and pepper in Idukki, for mint in UP and for chilli in Guntur.

Source: The Economic Times

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Naga blow to tea growers

Guwahati , Assam : Phuleswar Gogoi has procured a land acquisition certificate from the government and is all set to apply for Tea Board benefits to develop his 70-bigha tea estate located in Jorhat district along the Assam-Nagaland boundary. But a letter from the neighbouring state has jeopardised his plans.

“Why are agricultural activities being taken up in these areas meant for jhum cultivation without prior permission from Nagaland?” the letter sent to him by Leriman Basti village council in Nagaland asked and directed him to stop tea cultivation by today.

“Who would want to invest in a tea estate having an uncertain future? What will happen if the Nagas take possession of the tea estate tomorrow?” Gogoi, the president of the Seleng unit of the Small Tea Growers Association, said.

Gogoi said the council had sent letters to seven small tea growers about 15 days ago. The letters have made all the small tea growers along the Assam-Nagaland boundary jittery about their future.

Most of these tea estates have come up on government land in the past two decades.

The All Assam Students Union (AASU), which has been spearheading the state’s fight against encroachment of land by neighbouring states, today staged a four-hour sit-in at Seleng Chariali, under Teok police station, to demand security for the small tea growers.

The Jorhat unit president of AASU, Biren Saikia, said small tea growers in the bordering areas should be encouraged since they were the ones keeping Naga encroachers at bay by taking up cultivation.

“It is unfortunate that the government is a mute spectator to such threatening letters from across the border,” he said.

Saikia said Nagaland has also asked Laujan High School authorities to hand over the school to Nagaland.

Purna Phukon, another small tea grower, said he had struggled to procure the last possession certificate and had begun the process to apply for Tea Board benefits. But the letter had jeopardised his plans.

With the small growers coming up as big players in the Assam tea industry, the commerce ministry has given stress on developing this sector. It directed the government to issue land acquisition certificates to small tea growers so that they could reap the benefits from the Tea Board.

Gogoi said he has apprised the border peace committee, comprising representatives from Nagaland and Assam, about the letter.

He, however, expressed doubts that he would get any support. “What is the use of having a peace committee when we receive such threatening letters from across the border?” he asked.

Source: The Telegraph

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Tuesday, August 21, 2007

12 varieties of Jap Tea included on demand for Japanese delegates

New Delhi : When Japanese prime minister Shinzo Abe comes calling today — leading a 140-plus delegation from his country — he is likely to feel more at home than he may have expected. Japan, after all, is quite the flavour-of-the-moment at the luxury hotel in New Delhi where the premier and the delegates are putting up.

Right from making sure that the okayu, or rice porridge (a special request apparently), is on the breakfast table for the PM along with elaborate omelettes, folded several times over and layered with the likes of nori sheets and flaked dry fish, to flying in 60 kg of fish from Tokyo, the hotel seems to have spared no effort in making its guests welcome.

A Japanese chef is being flown down from the hotel chain’s trendy Japanese restaurant in Mumbai, and apart from the likes of steamed black cod on the menu, the prime minister and his spouse will also be treated to some special creations.

On the other hand, it is not yet sure — breakfast apart — how many meals the couple will actually be having at the hotel. However, since “the news has filtered in” that they also like curries, the Indian kitchen has been kept in readiness. On the menu are chicken curry, mutton biryani and the master chef’s trademark galauti kebabs.

And if the visitors call for some beverage, a Japanese tea festival is fortunately underway too. About 12 varities of Japanese tea are on offer including Sencha, the most popular type, Macha, or powdered green tea, Hoji Cha, roasted leaf, and Genmaicha that is rice-flavoured. If you fancy a discerning sip, the hotel is likely to resemble a fortress these few days.

The prime minister and his wife are, of course, going to be put up in the super-plush presidential suite of the hotel, amongst the best in the country with its Napolean chairs, original artwork, gold-plated cutlery, IBM thinkpads, digital phones, weatherproof speakers in the bathroom, treadmill and the like.

A bevy of heads-of-states and corporate heads have availed of all these in the last few years but unlike the demands of some, the hotel says it has not received requests for anything special this time round — apart from the porridge.

One request, however, is to arrange for a ladies’ lunch at a tony club within the hotel to be hosted by Mrs Abe.

Needless to say, this too will be an all-Japanese affair but the menu, according to its executive chef, seems to be a trifle more eclectic: Green tea-flavoured noodles and, hold your breath, wasabi-flavoured creme brulee (all specials from the Mumbai restaurant)! Some would call it lunch diplomacy.

Source: Business Standard

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Tea leaves fallen prices tough on tea growers

Over 8,000 small tea cultivators in north Dinajpur district of West Bengal face the risk of running an unviable business as prices of green leaf have fallen by Rs seven to Rs four a kilo.

"The small growers who used to supply their produce to the bought leaf factories got rupees 11 per kilo for their produce even a couple of months ago," Assistant Secretary of North Bengal Small Tea Planters Association Ratan Saha said.

"Now they are being offered four rupees per kilo which is even less then their production costs", he said.

"Many small growers who had invested their entire savings were left with no no option but to close the gardens," General secetary of Uttar Dinajpur Small Tea Growers' Welfare Association, Debasish Paul told newsmen here.

Source: Press Trust of India

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Monday, August 20, 2007

Closed tea gardens to get new owners

Kochi : For the first time in 54 years, the commerce ministry has set in motion the process for identifying buyers for the 24 closed tea gardens across West Bengal, Kerala and Assam after taking them over by early September.

The commerce department, through an order from director Raj Singh, has set up a committee to evaluate the proposals to be received for change in management of the closed tea estates, 13 in Bengal, nine in Kerala and two in Assam.

The ministry has already issued notices to the owners under Section 16(E) of the Tea Act, 1953, which states that if a garden remains closed for more than three months, the government has the power to take over them without investigation and find a new owner.

Jairam Ramesh, minister of state for commerce, said that talks with the owners of the other closed tea estates seem to have reached a dead end, forcing the ministry to invoke Section 16(E). “Section 16(E) has never been invoked in the last 54 years. There are no set procedures and we will be writing on a clean slate,” the minister noted.

The owners of the closed gardens have been given time until end of August to identify new owners or reopen them. Or else they will be taken over by the government which will pass over the management to new buyers.

Through the latest order of 16 August, a committee headed by O.P. Arya, additional commerce secretary (plantations) has been formed to evaluate the bids of those who intend to take over the estates. Others in the committee include Basudev Banerjee, chairman of the Tea Board, the government’s trade promotion body, the chief secretaries and the finance secretaries of Bengal, Kerala and Assam and Sutanu Behuria, additional secretary in the commerce department.

The crisis in the tea sector in early 2000 when prices plunged led to the estate closures. Of the 14 estates that closed in Bengal between 2001 and 2003, only one has reopened. In Kerala, though 23 estates had closed between 2000 and 2003, six of them reopened by 2003. Attempts by the commerce ministry and the Tea Board of India, begun nearly 10 months ago, led to the reopening of eight of the closed gardens by April.
Ramesh said that in the Ramjorah estate in Bengal, the lease period had ended and so the government was free to invite bids for takeover. In the case of a few other estates, such as Chamurchi, the owners had identified prospective buyers.

“The process of reopening closed tea estates in Kerala is proving to be less cumbersome, compared to Bengal,” added Ramesh. This was mainly owing to some of the estates having common owners. The four estates of the Ram Bahadur Thakur Group (1) had reopened, including a factory of the group. However, the reopening of the five estates of the RBT Group (2) look remote though talks have been held with the owners. Manoj Sharma, chief executive officer of the RBT(1) had earlier expressed willingness to take over the management of the other five estates. Three MMJ estates of the Manarcaud family had also opened with a factory slated to open in2008.

Ramesh said that most of the closed estates in Kerala were in Peerumedu in Idukki district, which were suitable for manufacture of high quality orthodox tea that had high demand abroad and the owners were being requested to look at shifting from the manufacture of cheaper CTC (cut, tear and curl) teas. The government has readied a Rs60 crore relief package for the closed estates, which includes waiving all dues to the tea board and defaults under the provident fund. Loans from banks and other institutions of about Rs58 crore are to rescheduled with penalties written off.

Source: The Wall Street Journal

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Domestic tea price unaffected by slowdown in tea exports

Mumbai : Expectations of a slowdown in tea exports are unlikely to hurt prices of the commodity in the domestic market.

Exports presently constitute less than 26 per cent of the domestic tea production. A high domestic demand, coupled with the low opening stock, is expected to keep the domestic market for tea tight, according to the Centre for Monitoring Indian Economy (CMIE), an independent think-tank.

Tea prices have been steadily increasing in the past few months from Rs 61.12 per kg in January 2007 to Rs 65.07 per kg in April 2007 and rose to a peak of Rs 71.92 per kg in July. Earlier, the prices had picked to Rs 70.98 per kg in September 2006.

Exports of tea rose by a robust 64.2 per cent to 56.8 million kgs during January-March 2007. However, CMIE expects exports to remain subdued in the coming months because of the strengthening of the Indian rupee against the US dollar.

The tea industry is also likely to miss the target of 210 million kgs exports this year, CMIE said.
The reasons for the drop in exports are also attributed to decreased exports to Iraq due to payment problems. The appreciation of the rupee has resulted in a loss of Rs 4-5 per kg of tea exports. Tea exports to violence-affected Iraq have declined to 3.35 million kgs in Jan-Apr 2007 from 10.54 million kgs in Jan-Apr 2006.

India's tea production declined by 2.4 per cent in Assam and 3.1 per cent in the South. The country produced only 334.7 million kgs of tea during January-June 2007, almost equal to the amount produced in the same period of the previous year.

Industry had forecast tea output to rise by three per cent to 984.6 million kgs in 2007. However, looking at the current sluggish trend and adverse weather conditions in Assam and Nilgiris, it is feared that the actual production may turn out to be a little lower than the forecast.

Between January and June this year, the country's tea production increased by a meagre 0.01 per cent at 3,34,710 tonnes, up from 3,34,669 tonnes in the same period of last year, according to statistics compiled by CMIE.

The country's largest tea producing region, Northern India, registered 1.58 per cent jump in production to 2,25,336 tonnes in January-June 2007 from 2,21,826 tonnes in the corresponding period last year.

West Bengal registered 10.11 per cent jump in production at 77,149 tonnes during January-June 2007 as against 70,066 tonnes in same period last year. However, Assam reported a decline by 2.42 per cent at 1,46,372 tonnes in the six months period ended June 2007 from 1,50,004 tonnes.

Southern India also posted 3.07 per cent decline in tea production at 1,09,374 tonnes in January-June 2007. Kerala's tea output dipped sharply by 11.80 per cent, from 35,539 tonnes to 31,344 tonnes in January-June 2007.

Karnataka reported a 5.48 jump in production at 2,617 tonnes and Tamil Nadu 0.79 per cent at 75,413 tonnes in the six months period ended June 2007.

Source: The Economic Times

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Mixed Prices at Coimbatore tea auction

Coimbatore : Mixed price trend persisted in the Coimbatore tea auction held last week, with leaf teas quoting dearer by Re 1 to Rs 4 a kg and dust selling Re 1 to Rs 2 easier per Kg, industry sources said on Monday.

With shippers to CIS Countries operating with fair strength in the orthodox leaf grade, a few larger teas and brokens were well-appreciated in value by Rs 3 to Rs 4 per kg, while fair demand made brighter liquoring CTC leaf rule from steady to occasionally dearer by Rs 1.50. Other CTC leaf quoted easier by Re 1, the sources said.

Limited quantity of medium orthodox were sold at Re 1 to Rs 2 easier levels, whereas fair demand for selected high priced popular marks and good medium CTC dust quoted dearer by Re 1 and medium and plainer teas quoted easier by Re 1.

Orthodox high grown brokens quoted at Rs 64 to Rs 82 and fanning Rs 50 to Rs 65, good CTC brokens Rs 43 to Rs 50, fanning Rs 45 to Rs 42 and medium CTC brokens Rs 35 to Rs 41 and fanning Rs 35 to Rs 42.

Best CTC dust quoted Rs 58 to Rs 66, good Rs 47 to Rs 58, medium CTC dust Rs 38 to Rs 44 and medium orthodox dust Rs 35 to Rs 41 per Kg.

Of the total offerings of about 5.44 lakh kg, dust comprised 3.26 lakh kg, sources said.

Source: The Hindu

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Bad weather and pest attacks on tea

Unpredictable weather and rampant pest attacks have left tea planters calculating the losses of the past few months.

Bouts of incessant rain between May and August alternating with sunshine and temperatures of around 40 degrees Celsius have led to a loss of production by 10-20 per cent in the Dooars and the Terai.

Prabir Bhattacharjee, the secretary of the Dooars branch of Indian Tea Association, said: “A drop of 10.36 per cent in production has been noticed in this period. In July this year, an unprecedented rainfall of 47.09 inches was recorded as against 25.87 inches last time.”

“Even during the first fortnight of August, it didn’t change much. We doubt if the losses can be made up by October after which the lean period starts,” said Bhattacharjee.

Equally alarming is the pest attack. A.K. Chatterjee, the manager of Pahargoomia tea estate in the Terai, claimed that the garden has suffered a loss of 10-15 per cent. “And it can’t be compensated,” he added.

R.K. Rungta, manager, Kurti Tea Estate, pegged the loss from pests between 5 and 25 per cent across north Bengal. The pests include looper caterpillar, red spider, helopeltis, thrips and green fly.

Pests and weather combined, planters claim that the estimated loss this year would be around Rs 30 crore. “About 25 per cent of the annual production takes place during this quarter,” one of them said. “Given last year’s figure of 200 million kg in north Bengal, we anticipate a loss of at least 10 per cent of the 50 million kg (produced during these months), which brings it to 5 million kg.” Considering the average price of Rs 60 per kg, the loss will be around Rs 30 crore.

Officials of the Tea Association of India (TAI) sounded equally worried. “The temperature was just right for pests. These grew and attacked the bushes on a massive scale,” said Ranjit Dutta, the secretary of the north Bengal branch of TAI.

Researchers of the Tea Research Association (TRA) however, are more hopeful. “Pest attack and erratic weather have indeed affected the tea gardens, but things are expected to be better in the next few months,” said Pradip Ghosh, the chief advisory officer of TRA, Nagrakata.

Source: The Telegraph

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Saturday, August 18, 2007

Small tea growers with entrepreneural skills

Dibrugarh , Assam : Amidst raging price fluctuations, escalating costs of production and lower yields of green tea leaves, most of the economic woes of the small tea growers can be erased only if the small growers learn to be better entrepreneurs. A livelihood is sustainable for the tea growers if it can recover from stress and shocks (local, domestic and international) and increases its competency in the global market. The Centre for Education and Communication (CEC), a Delhi-based non-governmental organisation, which has taken the challenge to empower and encourage the tea growers and its workers, has underlined.

CEC believes that proper approach and ambitious yet applicable strategies could bring considerable change in the economy of the almost frustrated tea growers. The programmes the CEC harps on are part that will empower tea growers to cope with continued economic and ecological crisis, changes in the market structure due to globalization.

The CEC which claims to have made a study on the whole aspect of tea in India feels every contributors of the supply chain should have share equal to their contribution, adding, only that can be a good business. To begin with its empowerment programme, CEC is primarily focusing on getting all the small tea growers in groups- self help groups to encourage community enterprises. The organization is also imparting orientation and training to the self-help groups already formed. The trainings are part of the project "sustainable livelihood for small tea growers and workers in India".

The objectives behind the formation of societies of the Tea Board of India (TBI) are extension-technology and information dissemination, leaf collection, storage and transportation, procurement and supply of inputs such as fertilizers, plant protection chemicals, sprayers, pruning machines, irrigation equipments etc to the members of society.

To ensure these objectives, according to Utpal Kumar Mishra, field officer, CEC, understanding among members, knowledge on cultivation and market trends, transparency and proper accounting system, records maintenance, learning mind-set from the scientific system of tea maintenance, and avoiding middlemen are must.

The CEC with the logistical support from the All Assam Small Tea Growers Association (AASTGA) has been conducting series of trainings among the new and old societies in co-ordination with regional committees under Borboruah, Lahoal, Belbari, Tengakhat, Barekuri in Dibrugarh district as well as neighbouring Tinsukia district. As the central committee representative, Diban Phukan, publicity secretary, AASTGA is attending the programme along with Mishra, the field officer, CEC.

During the initial research, the CEC found that many societies were not in the track (interest conflict, poor cultivation practices, lack of basic information and understanding about tea industry). “It was observed that growers even though are society members do not understand the basic objective behind the formation of societies (SHG)”, Mishra shared while interacting with *The Assam Tribune*.

The issues like, importance of society, activities of TBI and Tea Research Asociation (TRA), importance of quality, auction system of tea, marketing of tea, supply chain of tea, improvement in bargaining are being covered during the orientation programme.

CEC believes that communities are both subjects and objects of change and they have much strength to change into vigorous communities. "They really need the ideas and knowledge to understand about their own role and situation in the tea industry," Mishra said.

Source: Assam Tribune

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India Post to open forex counters

New Delhi : Post offices in metros are set for a major change with the Government deciding to introduce new facilities like forex counters, cargo services, access to instant money order and other revenue generating services.

"We have got the licence from the RBI to start the foreign exchange business in some post offices in selected metros. We are finalising the deal which would be operational soon," S Samant, Chief General Manager, Business Development, Department of Post (DoP), said.

The department is acquiring an Air India flight to operate a dedicated cargo service carrying parcels, mails and couriers to north eastern states which will swift the delivery of mails in the region, Samant said.

The cargo flight would take off from Kolkata every morning and return in the evening after delivering the services at Agratala and Imphal, he said.

The Postal department recently signed an MoU with the Railways to sell train tickets in some of the post offices. Besides, it has undertaken the task of verifying pre-paid mobile subscribers in some areas, Samant said.

"The future vision of DoP is of a socially committed, commercially oriented and technologically driven organisation which can deliver services to the farthest corners of the country at affordable rates," Samant said.

There are about 1,55,669 post offices all across the country with a significant number of employees. However, its core business of selling stamps and post cards has dipped over the last five years.

To keep its market share intact, the department is also planning to set up a bank, which has been tentatively named as the Post Bank of India.

According to John Samuel, General Manager of DoP, "We continue to evolve to meet the business needs of a rapidly-growing economy without losing our social moorings.

"We have a new concept which envisages converting each post office into a one stop shop for various facilities from postal to stationery to e-post, mutual funds, tea, flowers and gift items."

Tea is already being sold in post offices in West Bengal and Sikkim where customers can buy and also send tea to a chosen destination through air mail, parcel or speed post.

The computerisation process is already on to connect all post offices across the country, Samuel said.

Source: Press Trust of India

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After Darjeeling Tea GI, Assam and Nilgiri follows

Kolkata ( Calcutta ) : First it was the Darjeeling brand. Now, Nilgiri and Assam teas, which are strong brands with a value proposition, will be protected internationally under the Geographical Indications (GI) Act.

With the issue of international property rights at the top of the agenda, the Tea Board has engaged lawyers and will shortly register the Nilgiri brand.

The Tea Board wants to get them registered before November, when the International Tea Convention takes place in India.

“The application for the Niligiri teas is being filed at the GI office in Chennai. About 1500 square metres of area which grows orthodox teas in the upper reaches of the Nilgiri has been considered. The Nilgiri variety of tea has the potential to establish itself as an independent brand,” Anindita Roy, director, tea promotion, Tea Board told DNA Money.

Owing to their non-homogenous character, teas grown in Assam, the largest tea growing area, are getting delineated for establishing a generic brand profile to qualify for a GI mark.

“A common GI identification may not be possible in case of the teas grown in Assam where there are a lot of complexities like seasonal variations which reflects on the tastes. While teas grown in the Brahmaputra Valley are sure to be included the other regions may have to be delineated,” Roy said.

Assam teas have a specific identity especially for the famous ‘second flush’ and renowned for their malty intrinsic character internationally.

Each of these teas has specific characters unique to the geographical areas where they are grown and cannot be replicated anywhere else in the world under these names. Moreover, the reputation stems from the place of origin.

Agricultural products typically have qualities that derive from their place of production and are influenced by specific local factors, such as climate and soil.

The new GI Act regulation will encompass total protection against any kind of misuse of the Assam or Nilgiri name and anyone who does so will be liable for charges of criminal offence against infringement of any kind.

As the quality and purity of these teas largely vary across the state, the Tea Board is likely to come up with some form of regional protection formats like logos for the regions, which may not be covered under the GI.

According to planters, once the area gets delineated, duplication becomes very difficult. This in a way also helps create a complete awareness campaign around these teas.

Source: DNA

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Assam tea Gardens and tea wines

Tocklai ( Assam ) : The gardens of Tocklai in Assam, the world's oldest and largest tea research station, are all set to raise a storm in your tea cup.

The scientists are working round the clock. They are stirring up a magical combination that's going to give India and the world its first tea tablets, first tea biscuits and tea colas and interestingly- wine.

"In Japan you will find wine mixed with tea. They call it tea-wine. But in our case, the base is tea from which wine is developed,” says director, Tocklai Tea Station, Dr Mridul Hazarika.

And if it becomes a morning cup of wine instead of tea, you can take heart from the fact that the scales will not be weighed too much against your health.

Says Dr Hazarika, “If this wine will come true then it will have an anti-oxidant property much more than normal wine.”

Tocklai that celebrates its centenary year in 2010, has been working on developing diversified products from tea to absorb the shock of a continuing depression in the tea market.

The three products will be unveiled during an International Tea Convention to be held in Guwahati and Jorhat simultaneously in November.

Source: IBNLive

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Tea Crop damaged by dolomite mines

Ahalya Gram , West Bengal : Rivers and streams situated in the Himalayan foothills of West Bengal have been turning white and murky, due to heavy discharge of waste by dolomite mines operating in the hills.

Rivers and streams have been turning white and planters in the tea-rich area complain that the dolomite flows to their gardens, spoiling the soil and crops.

"The erosion happening here is no small phenomenon that can be undone by one tea estate. The government or the health authorities have to intervene. The initiative would involve a lot of investment," said Subhashsish Kar, manager, Mission Hill Tea Estate, the biggest plantation in the region.

Over 16 acres of the Mission Hill Tea Estate alone has turned infertile due to erosion and deposition.

Most of the settlement around tea estates comprises of workers' colonies. At least 120 households have had to move away to settlements near relatively safe water sources.

"I have lost appetite and my whole body itches. Our children keep falling ill. There have been cases of diarrhoea as well. Stomach ache is common," said Laxman Saha, a Mission Hill employee.

The dolomite menace is yet another hit to the region's tea estates, many of which are reeling under losses and facing closure.

In all aspects of tea, - - production, consumption and export, India has emerged a world leader. The country accounts for 31 percent of global tea production.

It is perhaps the only industry where India has retained its leadership over the last 150 years.

The total turnover of the Indian tea industry is around Rs. 10,000 crores. Since independence tea production has grown over 250 percent, while land area has just grown by 40 percent.

There has been a considerable increase in export too in the past few years. Total net foreign exchange earned per annum is around Rs. 1847 crores.

The labour intensive tea industry directly employs over 1.1 million workers and generates income for another 10 million people approximately. Women constitute 50 percent of the workforce.

Tea trading in the domestic market is done in two ways- Auction and Private Selling. Market Reports are received from the six major auction centres in India, namely, Kolkata , Guwahati, Siliguri, Cochin, Coonoor, Coimbatore and N.I. teauction.com Bulk trading is done through the auctions held in these centres.

Source: ANI

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Tea Workers in Bengal needs Redress

Tea is India’s heritage. We don’t just wake up to our morning cup of tea, we are proud that all over the world that morning cup is very often Indian tea.

Today, tragedy envelopes Indian tea. As you sip, workers at the estates that produce the world famous Darjeeling tea are eking out an existence without adequate food or water, exposed to disease and malnutrition, robbed of basic amenities, healthcare, education or even a secure livelihood. The number of sick tea gardens increases with every year. Some have shut down due to insolvency and labour problems in the Dooars region of West Bengal. Owners have deserted their workers. New generation entrepreneurs have not taken interest in the revival of the plantation sector.

Recent fact-finding missions organised by the Save the Garden, Save Workers Campaign Against Hunger have revealed that the closed and sick tea gardens of Jalpaiguri district have reported starvation deaths due to unemployment, absence of alternatives and limited access to welfare measures. To counter starvation, women and children are being coerced into exploitative forms of work. The complete absence of human rights has led to suicide attempts and trafficking of children. Despite eyewitness and ngo reports, and government awareness, there is no concrete attempt to prevent human trafficking, or to provide protection for the elderly, sick and disabled; no attempt to provide basic amenities. Bigha workers are paid a meagre Rs 15-20 daily wage. In 21st century India, workers are mauled by wild animals near their huts. Their lives and future are paralysed by lawlessness and the absence of redressal forums.

The State’s apathy can be seen in the complete breakdown of government schemes, the denial of the rapidly deteriorating situation and the lack of relief measures from the state government. Most workers in the closed estates have not received their provident fund, gratuity and retirement benefits. Social security measures and rehabilitation packages are not forthcoming from the Central labour ministry for workers with no income. Everyone seems to have washed their hands of the workers — the owners, the government, the health authorities.

When Save the Garden arranged for several teams to visit Jalpaiguri district, the prevalent conditions there appalled all. How many reasons do we need to recognise the gravity of the situation? Isn’t the existing reality valid enough for someone to take note of the complete breakdown of socio-economic conditions and recognise a crisis? Or are we ready to witness another Kalahandi in Jalpaiguri?

By Sreerupa Chowdhury
Chowdhury is national convenor of the Save the Garden, Save Workers Campaign Against Hunger .
Source: Tehelka

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Friday, August 17, 2007

Jay Shree Tea to divest Assam unit, IT centre

Kolkata ( Calcutta ) : B K Birla-controlled Jay Shree Tea & Industries has decided to divest its bought leaf (tea) factory in Assam and infotech centre in West Bengal, as part of its restructuring plans.

According to an official release issued by the company to the BSE today, the company has informed that it would seek shareholders’ approval through postal ballot to approve divest/demerge/sale/transfer/lease the bought leaf factory and infotech centre.

Sources close to the development said, whether it would be sold or leased would depend on the buyer. Jay Shree Tea has tea production capacity of around 20 million kilograms, across North and South India and is only selling a bought leaf factory from its portfolio, whereas, the infotech centre could not make much headway as the size of operations was not viable. The call centre was located at Salt Lake, the IT hub in Kolkata.

Source: Business Standard

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Starbucks entry into India reads "Coming Soon!"

At the Starbucks headquarters in Downtown Seattle, there is an enormous scoreboard that keeps count of the number of stores the American beverage chain has opened across the world — some 13,000 in 40 countries at last count. The entry against India reads: Coming soon.

It’s been like this for a while, and it looks likely to stay that way for some time. Last month, Starbucks postponed its entry into India and officially withdrew its application to operate single-brand retail stores, without citing reasons. The scuttlebutt in the market is that the Seattle superstar got filtered as it tried to enter India through an NRI franchisee instead of the government’s preferred FDI route.

One reason Starbucks has had a stop-start issue in India is because it was tailgating smaller Indian coffee chains who got a head start, perhaps anticipating the arrival of the Seattle giant.

Companies like New Delhi upstart Barista and Bangalore’s Coffee Day have first mover advantage with scores of outlets already running. Evidently, Starbucks wanted to buy out one of them but found they were too pricey.

At the same time, Starbucks is lately leery of the direct entry, preferring the franchisee method. Last month, the coffee king got burnt in China, a country of teadrinkers, where it already has 240 stores. Rui Chenggang, China’s top TV anchor, tapped into popular outrage against a Starbucks’ outlet in Forbidden City (he compared to it having a Starbucks inside the Taj Mahal) to have it shut down. Next on the nationalist hit-list is a Starbucks outlet in Shanghai, just a few steps away from the original headquarters of the Chinese Communist Party.

It’s the kind of attention the Seattle superstore is used to. In 1999, protestors agitating during a WTO meeting on its home turf socked into it, branding it as the ugly face of globalisation. Yet Starbucks began modestly, and is a case study in entrepreneurship in the modern age. The first Starbucks, started by two teachers and a writer in 1971 in Seattle’s Pike Place market to sell coffee beans, was subsequently bought by Howard Schultz, who wanted to sell beans, beverage and bric-a-brac.

In less than three decades, Starbucks has become one of the world’s major brands. Today, it sells music, books and a range of merchandise. In China (and in India when it opens), both of which are primarily tea-drinking nations and where traditionalists may balk at paying $ 2.50 (Rs 100) and above for a beverage, it presents itself more as a hangout place for the young.

Despite Starbucks’ current setbacks, the two Asian giants are central to its goal of toting up 40,000 stores worldwide, which will make it arguably the largest retailer on earth. Some industry reports suggest that India’s nascent gourmet coffee market may sprout 5,000 cafes over five years. Like Wal-Mart, Starbucks could tap into a new segment, independent of the traditional dives, where oldtimers can continue to enjoy kaapi and chai-biskoot. Starbucks does not care if the young come in for hot air or cool vibes, as long as they spend.

Source: The Times of India

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Special Purpose Tea Fund receives poor response

Kolkata ( Calcutta ): The Special Purpose Tea Fund (SPTF), launched this year to rejuvenate age-old tea bushes, has been made more flexible in order to pep up the participation from gardens in South India.

While the first loan application is expected to be sanctioned within this week so as to enable the commencement of replantation activities before this monsoon, so far only 29 applications have been received from South India against the 300 applications received from Assam, West Bengal and Tripura till July 31. Labour shortage is believed to be the major factor that may stymie the participation of South Indian gardens.

SBI Caps, to whom the entire loan vetting process has been outsourced, is now grading the proposals — A to D —depending on tea estates’ financial parameters, managerial capability and the past development activities as evidenced by the field inspection reports. ‘A’ denotes top grade with a proposal with the ‘D’ tag requiring a reconsideration.

Confirming that response to the SPTF has been tardy from South Indian gardens, which contribute 200 million kg out of the 900-odd million kg produced by India, Tea Board sources said flexibilities regarding the minimum amount of land that could be taken up initially for replantation had been introduced in the scheme.

While earlier it was envisaged that loans would be given only if at least 2.5 per cent of the total area under a garden was proposed to be rejuvenated, it has now been decided to relax this norm.

Similarly, the upper limit has also been relaxed so that gardens wanting to replant over and above the existing ceiling of 12.5 per cent of the total area would be allowed to do so, provided there were no objections from the bankers and if the gardens were financially sound.

However, there seems to be little optimism regarding participation from South India even after such relaxations.

With a depleting manpower, the industry has been forced to go in for mechanisation, using, for instance, shear harvesters for tea-plucking. While this has addressed the industry’s labour problems to an extent, it has led to a drop in quality since tea plucking is all about selecting the right leaves and a bud to pluck. This is crucial to the flavour.

Moreover, replantation and rejuvenation does not generate huge interest among the garden owners most of whom have composite gardens where other plantation crops are also cultivated.

Source: The Hindu

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Wednesday, August 15, 2007

Some Info About Indian Tea

Assam Tea : Assam produces more than half the tea grown in India. This tea grown at sea level is known for its body, briskness, malty flavor, and strong, bright color. Historically, Assam is the second commercial tea production region after China. China and Assam are the only two regions in the world with native tea plants. Assam mainly produces black tea. The Guawati Tea Auction Centre(GTAC) handles mainly assam teas.

Darjeeling Tea : The renowned gardens of Darjeeling produces teas with a distinguishable muscatel flavor and aroma. Grown on steep mountain slopes at elevations of 1,500 to 7,000 feet above sea level, these delicate teas command some of the world¹s highest auction prices. The combination of natural factors that gives Darjeeling tea its unique distinction is not found anywhere else in the world. Darjeeling tea is also known as “the champagne of teas" for its delicate aroma and light colour.

Nilgiri Tea : The Blue Mountains or the Nilgiris are situated in South India. The Nilgiri tea is dark intensely aromatic and flavoured.The tea provides a higher number of cups per measure (technically known as cuppage) because of the Crush, Tear, Curl or CTC process of manufacture. The expensive full leaf versions of the tea like the Orange Pekoe are highly sought after at international auctions making it unaffordable for most locals.

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Tuesday, August 14, 2007

Green Tea good for your health

The Chinese were the first people to realise the properties and benefits of green tea. It was only later that tea came to be treated as a beverage.

Research has provided hard-core evidence of the health benefits of green tea. Green tea is loaded with catechin polyphenols, especially epigallocatecchin gallate, which is commonly referred to as EGCG.

In addition to being a wonderful anti-oxidant it also destroys malignant cancer cells leaving healthy tissue untouched.

Black tea, oolong tea and green tea have the same origin - The camellia sinensis plant, but green tea earns its reputation because the EGCG in it remains unoxidized and unfermented. In the other two kinds of tea, EGCG is changed into different compounds and the medicinal effect is diluted.

Green tea is often spoken of in the context of cardiovascular disease. It helps to lower LDL cholesterol, which is responsible for the formation of blood clots and thus reduces the risks of stroke and heart attacks.

It is in fact as effective as aspirin in preventing platelets from clotting and greatly reduces levels of thromboxane, which is the villain in causing blood clots. It also promotes the production of HDL and does away with plaque present in the arteries.

Source: The Times of India

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Indian Tea Company buttering Shaolin Temple for Chinese market

Dengfeng (China), Aug 9 (PTI): An Indian tea company is set to piggyback the world famous Shaolin Temple, set up here in central China to honour an Indian Buddhist monk in 495 AD, to enter the huge Chinese market.

"A famous Indian tea company, wanting to enter Chinese market, is discussing with us on cooperation," the abbot of Shaolin Temple, Shi Yongxin told PTI here.

However, the abbot declined to name the Indian tea company.

Another temple official said it was too early to make the business deal public.

The Shaolin Temple in Dengfeng, Henan province, is widely considered the birthplace of Shaolin boxing, a unique combination of Buddhism and Chinese martial arts that evolved into Kung Fu.

Interestingly, Tata Tea had signed a joint venture agreement with Zhejiang Tea Import & Export (ZTIE) company of China in May.

Meanwhile, the Shaolin Temple, realising the potential value of its famous image and name, is fighting against increasing misuse of the 'Shaolin' trademark by unscrupulous traders for commercial purposes.

The Buddhist temple made famous by dozens of Kung Fu movies, has registered "Shaolin" and "Shaolin Temple" as trademarks with China's General Administration for Industry and Commerce, the abbot, wearing mustard-coloured robes, said.

It has also set up a firm to safeguard the temple's reputation and ban its "abusive use" in commercial activities.

"We have registered our trademarks in many foreign countries, including India," said Shi, a Chinese lawmaker who visited India in 1995.

Source: PTI

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Centrol Food Grain Policy to affect the Tea Industry

Kolkata ( Calcutta ) : Profitability of tea companies with a presence in Assam and West Bengal may suffer in 2007-08 as production costs are slated to shoot up in coming months. The prime contributor to the sudden spurt in production costs is food grain which tea garden owners have been forced to buy from the open market and provide it at a subsidised rate of 47 paise per kg to their workers.

Till recently, tea garden owners were allowed to buy food grain for workers through the public distribution system (PDS) at a price way below the prevailing market rates. However, the Central government has now introduced a new system, targeted public distribution system (TPDS), for tea gardens.

"So far, the state governments have been making allotments of food grain to the tea industry for consumption of its workers. On the introduction of TPDS in tea gardens, the quantity of such allotment has been drastically curtailed," Tea Association of India president Shashank Prashad told Economic Times.

Traditionally, the owners are required to provide 35.25 kg of food grain to a tea garden worker on a monthly basis. The new system allows the garden owner to buy only 7 kg of food grain from PDS. He is forced to buy the rest 28 kg per worker from the open market.

"As a result of this open market operation, the market prices of food grain have shot up to a level going beyond the means of the tea industry, which is reeling under crisis for the last eight years," Mr Prashad added.

Tea companies are also upset over the sudden rise in food grain prices. "The industry had been asking the Central government to bear a portion of the social cost fund that we have to bear. The government has done nothing.

On the contrary, it has now increased the food grain prices. This will affect the profitability of the companies as the labor cost will go up substantially," said a Warren Tea official. His view was shared by Dhunseri Tea, Goodricke Group and others. Tea Board chairman Basudeb Banerjee said: "It is a Central government policy and we can hardly do anything."

Source: The Economic Times

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Monday, August 13, 2007

Indian Chai and Double Roti

New Delhi / Mumbai : Tea in the hands of British facilitated trade, triggered tax regimes, even sparked revolutions. The brew may have originated in China, but there's still nothing more English than a cuppa tea.

But while the British introduced tea and crumpets with jam to India, the post-colonial nation found its own take on this heady concoction. Sixty years after Independence, India still snacks on them, but knows them better as chai and “double” roti

Boiled and sweetened with copious amount of milk and sugar, the humble pyala (cup) of chai comes in many a variety - aada doodh aadha paani (water and milk, half-and-half), masala chai, malai maar ke (creamed tea), kullar chai (served in earthen pots) and Mumbai ki cutting chai (Mumbai special tea).

India today consumes over 700 million kilos of tea every year and the ritual cuts across socio-economic barriers.

It’s hard to believe that over 150 years ago, the British started the country's first tea plantations, traded in tea under East India company and even ran commercial campaigns to popularise tea drinking among Indians.

Source: IBN Live

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Water Wisdom - Tea

New Delhi : Dire warnings that the future wars will be fought over water may come true sooner than anticipated, albeit with a flavour. At least four behemoths, three of them multinationals, will soon mount an assault on the flavoured water market.

So far, north India-based D S Foods, not encumbered by any competition, has been ruling the market with its Catch brand priced at Rs 30. That will change soon as Coca-Cola, PepsiCo, Nestle and Tata Tea – the first three already dabble in bottled water – will soon try to trip Catch.

The fourth, Tata Tea, had recently taken 30 per cent equity in Glaceau of the US, which has a large portfolio of enhanced waters, only to sell it to Coke. It has recently acquired the Himalayan water brand.

The flavoured market in India is small, only about Rs 11 crore out of the total bottled water market of about Rs 1,100 crore. But many small market segments have been known to explode with the entry of good products. For example, enhanced and flavoured waters were just $ 234 million in the US in 2000. By 2010, the category is projected to grow to $ 8.6 billion and is the fastest growing beverage category.

India shows a similar promise. The “2007 India Soft Drinks Report” by international beverage research specialist Canadean, says carbonated beverages declined in India for the second consecutive year in 2006, with little improvement projected in 2007. Packaged water growth projections, however, are in excess of 40 per cent, with still drinks (Frooti, Maaza and others) growing at under 10 per cent. Coca-Cola is expected to launch Bonaqua, by December this year.

Globally, Bonaqua sells sparkling flavoured water in ranging from strawberry, litchi, apple and mint to lemon and lime. In India, it is likely to be priced between Rs 20 and Rs 30 a bottle. Coca-Cola already sells in India the bottled water brand Kinley. "We are constantly looking at newer innovations in the potential market segments," said a spokesperson for its India operations.

Tata Tea is also looking to extend Himalayan into flavoured water. However, its executives only said that the company was looking to extend the brand into premium categories.

PepsiCo too is believed to be planning to extend its bottled water brand, Aquafina, into flavoured water. A company executive said it was too early to comment as entry plans were still being evaluated. Nestle executives refused to comment.

Parle’s Bisleri, PepsiCo’s Aquafina and Coke’s Kinley at present rule the lower end of the Indian packaged water category, priced as they are between Rs 10 and Rs 14 for a 1 litre bottle.

The top end is dominated by imported brands like Groupe Danone’s mountain water brand Evian and Nestle’s sparkling water brand Perrier, priced between Rs 80 and Rs 110 a litre. Himalayan costs Rs 25 a bottle. Flavoured water falls in the mid-priced segment of the bottled water category.

WATER WISDOM
# D S Foods is now ruling the Indian flavoured water market with its Catch brand priced at Rs 30
# Coca-Cola, PepsiCo, Nestle and Tata Tea are set to enter the market soon
# The flavoured water market now is just 1% of the Rs 1,100 crore packaged water category in India

Source: Business Standard

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India Tea Market in Russia - Tata Tea

Kolkata ( Calcutta ) : Tata Tea is teaming up with Tata Coffee and a few other institutions to aggressively promote Indian tea brands in Russia. Russia has traditionally been one of the strongest markets for Indian teas and the move is aimed at regaining India's market share in Russia.

Tata Tea managing director Percy Siganporia said that plans were still in a fluid state but confirmed such a proposal has been floated. "A new enterprise will be formed which will promote Indian tea brands in Russia," Siganporia said. He, however, did not divulge further details. Siganporia was speaking to reporters on Saturday at the Indian Tea Association's annual general meeting.

Union minister of state for commerce Jairam Ramesh, who was also present in the ITA meeting, said that Russia is currently the second biggest importer of both tea and coffee from India. Russia accounted for 20 per cent of India's coffee exports during 2006-07, close behind Italy at 27 per cent. It imported 32 million kg of Indian tea of India's total export basket of 185 million kg.

While Russia, Iraq and Pakistan have remained a stronghold for India's tea exports over the years, the Union commerce ministry has identified new markets in Egypt and Iran. The ministry is keen to set up a tea marketing office in Cairo for which it has written to East India Hotels Ltd, which currently operates a luxury hotel in Cairo, seeking help.

"We are hopeful that the tea marketing centre will be a reality soon," Ramesh said. Earlier, the ministry had planned to set up a similar centre at the Air-India office in Cairo but had to back out owing to objections from the landlord.

Source: Hindustan Times

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Tea Export Earnings dipped Rs. 9.12 Crore

Kolkata ( Calcutta ) : Tea exports for the first six months of 2007 dropped 11.8 million kg. Export earnings also dipped Rs 9.12 crore.

Kenya, which had a bumper crop this year, reported a 24.7 per cent jump in exports at 151.3 million kg till May this year against 121.4 million kg in the year-ago period.

China also recorded an 8.7 per cent rise in exports at 121 million kg.

Sri Lanka, however, registered a drop in exports at 112 million kg compared with 123.3 million kg because of labour problems.

In India, exports from the north rose to 35 million kg from 33 million kg, while those from the south were down to 39.7 million kg from 54.5 million kg.

Tea auctions in north India saw a rise in volumes for the first half of the year to 116.3 million kg from 114.7 million kg a year ago. This comes at a time when the Tea Board and the commerce ministry are planning to implement the e-auction system. In terms of value, the price slightly declined to Rs 69.72 per kg from Rs 70.79 per kg in the corresponding period of the previous year.

In the south, the volumes dipped to 59.2 million kg from 65.5 million kg. The value, however, improved to Rs 52.58 per kg from Rs 49.26 per kg in the year-ago period.

The rising rupee added to the woe of exporters. Branded tea companies such as Tata Tea have lost around Rs 3 crore on a stand-alone basis and Rs 10 crore on a consolidated basis.

McLeod Russel India, one of the largest tea producers, also expects a drop in exports to around 21 million kg from 25 million kg last fiscal.

Source: The Telegraph

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