A five-year agreement between the Tea Board and two Russian enterprises had talked of informing details on import of tea to the Tea Board on a quarterly basis.

A top industry official and exporter to Russia told The Financial Express that the industry was not quite aware of any information from the Russian side pertaining to the types and amount of teas, their categories, and grades to be exported for the year.

The agreement valid for a period from January 1999 to December 2005 was made with the Russian government's promise to accord due status to a long-term agreement of lifting 100 million kilograms from India annually. This agreement was made following the fear of dwindling Russian exports on account of the country's continuing economic crisis.

The progress on the issue was to be made via a core group of experts on both sides who wereslated to meet every quarter to assess the flow of teas. Trade circles said that they were unaware of any progress on this issue. "An estimated target of exporting 100 million kgs is not a difficult target, but what needs to be reviewed is the factor of consistency. For Russia, whose economy has been improving in recent times, is still not in a shape to buy expensive teas from other countries," said an industry analyst.

Price happens to be the single-most deciding factor towards greater exports to the Russian Federation. According to industry observers Russia needs cheaper teas, and Indian tea prices cannot go below a certain limit.

It is believed that Sri Lanka is yet to recover its amount which it had provided on credit to the Russian buyers. Infact, for Russia with an estimated market of 150 million kgs, Indian teas have always been a favourite-the closest competitor happens to be Sri Lanka whose teas are much comparable with the south Indian teas.

It is not known as to whether the Russian governmenthas given clearances to its importers for opening letters of credit towards Indian exports.

It may be noted that the Russian tea market is catered to by imports. In 1997, Russia imported a total of 158 mkgs, of which the highest proportion came from India at 90 mkg. This was followed by Sri Lanka at 35 mkg, China and Indonesia at 6mkg each. The final figures of 1998 are yet to be known.

The main companies which operate in Russia include May Company which controls almost 20 per cent of the total sales. The other large tea companies include Dilmah, Ormi Trade, Grand and Nikitin. The revival of the admistrative machinery in Russia is seen as a positive sign by most exporters who were beginning to feel that the Russian slump was having its repurcussions on Indian exports in general. It may be noted that prices of teas at south Indian auctions have been witnessing very low levels in recent times.