The northeastern state, the largest producer of tea in the country, has also allowed interest subvention of 3 per cent on all term loans and working capital advances which will lead to lower cost of fund and subsequently, encourage modernisation of factories.
The Indian Tea Association on Saturday said the Assam government’s decision to provide orthodox tea subsidy of Rs 7 per kg will boost exports of the beverage. The apex body of the tea industry in the country said the subsidy on machinery purchase to manufacturing units for producing orthodox tea will motivate them to produce such variety.
The Assam government made these announcements in the state budget for 2020-21 fiscal, presented on Friday. The northeastern state, the largest producer of tea in the country, has also allowed interest subvention of 3 per cent on all term loans and working capital advances which will lead to lower cost of fund and subsequently, encourage modernisation of factories. ITA secretary general Arijit Raha said Assam produces nearly 70 million kgs of ortodox tea, the highest in the country.
“Now, exports of tea from India is virtually stagnant at around 250 million kgs. Orthodox tea has wide acceptance in the overseas markets. If the producers manufacture more orthodox tea, the probability of increasing exports will rise,” Raha told PTI.
He said these steps will go a long way in revival of the tea industry which has been reeling under financial stress due to increasing cost of production and stagnant price realisations for the last several years. Meanwhile, the Joint Forum of Assam Tea Planters’ Association, North Eastern Tea Association (NETA) and Bharatiya Cha Parishad said that the state government’s decision to withdraw agricultural income tax for three years will greatly help the industry.
Adviser to NETA Bidyanand Barkakoty said the industry also appeals to the government to include other varities of tea such as green, purple, yellow and Oolong under the Rs 7 per kg subsidy scheme.