The Assam government on Friday announced four new schemes to boost the state’s tea industry, which has taken a severe hit because of the coronavirus disease (Covid-19)-induced lockdown restrictions.
Around 800 tea gardens in Assam had remained closed for around two months due to the lockdown, which were enforced from end-March because of the viral outbreak.
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Tea production until August is estimated to have dropped by around 25%, as compared to the corresponding period last year.
Assam finance minister Himanta Biswa Sarma, who announced the schemes, hoped that the initiatives would help the tea industry in the state to recover. The new schemes will cost the state exchequer around ₹200 crore.
“If any tea garden has taken a working capital loan from a commercial bank, the Assam government will pay 3% of the interest on the borrowed sum. The maximum cap on the subsidy will be ₹20 lakh for each tea garden per year,” Sarma said.
The state government will pay a tea garden a subsidy of ₹7 per kilogram (kg) to grow orthodox tea in a bid to promote production and export of this variant of the hot beverage. This incentive will be over and above the ₹3 per kg of tea to be paid by the Tea Board of India (TBI).
{{/usCountry}}The state government will pay a tea garden a subsidy of ₹7 per kilogram (kg) to grow orthodox tea in a bid to promote production and export of this variant of the hot beverage. This incentive will be over and above the ₹3 per kg of tea to be paid by the Tea Board of India (TBI).
{{/usCountry}}“The state government will also provide a 25% subsidy to procure plants and machineries to grow orthodox tea,” Sarma said.
The state government has also announced an agriculture income tax holiday to tea gardens for three years.
“We hope tea gardens will give a 20% bonus for the upcoming Durga Puja to all their workers following the state government’s announcements of the new schemes. Employees of gardens under the Assam Tea Corporation, a state government undertaking, have been assured of a 20% bonus,” Sarma said.
TBI data showed that Assam produced 223 million (m) kg of tea between January and July this year, as compared to 274 m kg of the hot beverage during the same period last year.
In 2019, Assam had produced 716 m kg of tea.
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The wholesale price index (WPI) for tea grew at an all-time high of 79% in August due to a drop in production. Though WPI for May was -1.8%, it rose to 8.9% in June and further shot up to 45.8% in July.
“The rise in prices is due to a drop in supply because of the lockdown restrictions. This had affected the tea auction as well. It started picking up only around end-August,” said Priyanuz Dutta, secretary, Guwahati Tea Auction Centre (GTAC).
He said GTAC sold around 49 m kg of tea between end-April and mid-September, as compared to 63 m kg of the plantation crop during the same period last year.