Assam tea planters to move Centre against ASEAN Free Trade Agreement

ASEAN Free Trade Agreement

Assam tea planters have decided to move the Union Ministry for Industry and Commerce and Tea Board of India against the ASEAN free trade agreement which envisages reducing agriculture commodity import tariffs to 50 per cent. 

Planters in Assam, which is India’s largest tea-producing state, fear that cheap tea will flood the Indian market and Indian tea will not be able to withstand the competition owing to high labour cost, low productivity of labours and land, and ever increasing input cost. 

There is a proposal to lower tariff from 110 per cent to 50 per cent by 2019. 

Prabhat Bezboruah, Chairman of Tea Board, said, "The ASEAN free trade agreement was signed in 2007-08 by the then Government under which the present Government is obligated to reduce agriculture commodity import tariffs to 50 per cent. However, the government has referred the matter to the Tea Board for our comments and inputs and we have sent our reply objecting to the same with emphasis on the potential risks to our industry." 

Paras Desai, executive director of Wagh Bakri tea and President of Western India Tea Dealers’ Association (WITDA), told ET, "In the era of globalisation we cannot stop a commodity form coming to another country. Reducing the tariff is an international commitment made by India and it has to be honoured." 

He said, "Initially there will be apprehension, but we are strong enough to withstand the competition. It is a time to strategise and make ourselves strong before the tariff is lowered. Let people have a choice." 

Adviser of North Eastern Tea Association (NETA) Bidyananda Barkakoty said, "There will be threat from African countries — particularly Kenya — in the event import tariffs are lowered. Our land and labour productivity is low; we have high input costs. We as planters do not have control over the input cost. Cheap tea from foreign countries will flood India. Bangladesh, Vietnam and Indonesia can sale tea at very lower price."


By BOA Bureau