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Jan 20, 2009

Tea Industry Should Shift From Production Oriented Strategy

With cyclic crisis in the Indian tea industry erasing fast, the current need was to shift from a production oriented strategy and subsidy approach to market oriented strategic framework with market economy outlook, an expert in tea in Himachal Pradesh said. This implied the need to liberate the mindset of the industry from its old strategic framework of produce and market, Gagnesh Sharma, Department of Tea Husbandry and Technology, Himachal Pradesh Krishik Varsity, Palampur, said in his study of Indian and Himachal Pradesh tea situation.

Due to the pressures of the economy, the earlier mindset of 'disposal of tea' was changing to a new one --'marketing of tea,' which implied a shift from 'subsidy' to capacity building approach, he said. In the absence of appropriate government interventions, attention may have to be given to developing appropriate agribusiness models with strong vertical coordination to ensure that small holders have financial capacity and access to information required exporting into global markets,he said.


Multinational tea companies were increasingly contracting with larger agro-processing firms,who were able to effectively coordinae deliveries and quality standards from small farmers through effective supply chain management, as in South India and Indonesia, Sharma said. Oversupply of tea and less demand has contributed to market imbalance in India. Strategies have to be devised to improve the demand side, as so much effort has been put in improving supply efficiency in the past, Sharma said.

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