India to close London, New York tea offices

Wednesday, 30 July 2003, 07:00 Hrs
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The Indian Tea Board will shut down its offices in London and New York to reduce costs, but its Dubai and Moscow establishments will stay, according to board officials.

KOLKATA: The state-run agency that promotes export of Indian tea will try to clinch deals through foreign embassies, having done so successfully earlier, a source said.

The decision to downsize the Tea Board's overseas establishments has, however, not gone down well with some people who argue that exports to Europe and the U.S. cannot pick up if the agency does not promote its own teas.

Indian teas hold only 19 percent, 20 million kg annually, of the British market, losing badly over the years to Kenya, which claims 43 percent. The U.S. market imports seven percent of Indian teas, but is seemingly growing fonder of these.

The two overseas offices are being scrapped by the Indian commerce ministry, apparently to reduce New Delhi's financial burden. However, industry experts are already beginning to count the losses from the decision.

"The London office promoted exports to Europe, particularly Britain, Germany, France and Italy. Can we now hope to increase exports after doing away with the office?" wondered a Tea Board official.

In 2002, India's tea output was 850 million kg, of which 193 million kg was exported.

The Indian tea industry, which is reinventing its export markets because of stiff competition from countries like Sri Lanka, Kenya, Indonesia and Malawi, is turning its focus away from traditional markets like Russia, Central Asian states and Britain to look towards the Middle East.

The decision to retain the Dubai office seems to have been taken because the United Arab Emirates (UAE) is one of the growing importers of Indian tea.

Tea prices have fallen by about 30 percent in the past four years.

The Tea Board has hired two market research firms to survey consumption patterns in countries like Chile, Russia, Syria, Saudi Arabia, UAE and Germany.

Source: IANS

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