Pakistan keen to buy Indian tea despite row

KOLKATA: Pakistan is keen on importing Indian tea. India exported nearly 20 million kg of tea to Afghanistan and Pakistan last fiscal. This is expected to surge this year as orders from the region are increasing.

CS Bedi, chairman of Indian Tea Association, said: "The constant effort of Indian producer-exporters to push teas into Pakistan and Afghanistan have started yielding results.

We are hopeful to achieve last year's export to the region this year as well." Pakistan drinks the crush-tear-curl ( CTC) teas and the per-capita consumption in Pakistan is around 1 kg.

The year 2010 was marked by lower production as well as exports, which at 193 million kg, were 2.3 per cent lower than that of 198 mil-lion kg in 2009.

Traders are looking to recoup some of the lost ground this year. Official statistics for destination-wise exports available for the January-May 2010 period show that exports to Afghanistan and Pakistan (known as AfPak) increased to 12.2 million kg from 7.4 million kg in the year-ago period.

"It is estimated to have touched 20 million kg by December," said a senior Tea Board official.

The industry feels that the opportunities provided by the buyer-seller meet at the recent India Tea Festival in Abu Dhabi for exports to countries like Pakistan will help overcome the hurdles posed by difficult political equations in the case of Pakistan and the turmoil and logistics in the case of Afghanistan.

"Many associations and trade bodies from Pakistan attended the meet in Abu Dhabi and held trade talks freely," an exporter said adding that frequently Pakistan rerouted exports to Afghanistan.

However, the industry is worried about the payment crisis in Iran, which imports orthodox teas. With the Iran payment crisis unresolved, India's production of orthodox tea is going to suffer a big blow this year.

While prices of tea have come down by almost 15% in the last six months, producers and exporters are apprehending losing out on one of the biggest orthodox destinations.

India exported 3-4 million kg of tea to Iran in 2010 as compared to 11.5 million kg in 2009. Bedi said prices of orthodox tea may take a hit due to drop in exports to Iran.

"We have taken up the matter with the finance and commerce ministries and we are hopeful that solution will be arrived at shortly," he said.