Darjeeling Tea industry is facing a severe crisis and competing for market share. Half of Darjeeling's tea estates are in the process of being sold. These tea gardens are currently searching for clients. This crisis has been brought on by rising labour wages, decreasing tea demand, and rising prices, as reported Economic Times.
Further,? the Tea Board of India has sought a special financial package of Rs 1,000 crore from the union government for the Industry.
Indian Tea Exporters Association chairman Anshuman Kanoria told Financial Express, ¡°Apart from unfavourable weather conditions, production will be down as most of the gardens of the Darjeeling Organic Tea Estates, one of the largest groups, were closed due to financial troubles.¡±?
Also known as the "Champagne of Teas", Darjeeling tea is produced in the hills of Darjeeling in West Bengal. In 2004, it became the first Indian product to receive a GI (Geographical Identification) label due to its distinctive flavour and aroma.
Darjeeling is home to approximately 87 gardens that employ approximately 55,000 people. These gardens collectively produce 7 million kilograms of tea, the majority of which is exported.
Substandard tea imports from neighbouring countries, particularly Nepal, have been blamed in a Parliamentary Standing Committee report for jeopardizing India's tea industry. The Revised Treaty of Trade between the Governments of India and Nepal has been misused by traders to import inferior tea, sell it, and then re-export it as premium Darjeeling Tea.
According to The Hindu report, the Darjeeling Hills witnessed a shutdown halting tea production due to agitation for a separate State of Gorkhaland. Also, exporters have shifted to cheaper varieties of tea, including imported Nepalese varieties.?
Due to the war between Russia and Ukraine, there has been a significant drop in Darjeeling Tea demand, particularly from the European market.
Darjeeling produced between 10 and 12 million kilograms of tea a decade ago which today stands at 6.87 million kilograms due to multiple factors, including climate change and decreasing soil yields. In contrast to the rising cost of inputs, which has increased between 10% and 12% CAGR (cumulative annual growth rate), Darjeeling Tea prices have only increased by 1.7% over the past six years.
India is the world's second-largest tea producer after China.? Tea from Assam, Darjeeling, and Nilgiri in India is regarded as among the best in the world. India produced 1,283 million kilograms of tea in 2020-21.?
India consumes the majority of its tea domestically. Russia, Iran, the United Arab Emirates, the United States, the United Kingdom, Germany, and China are significant destinations for exports.?
With approximately 83% of the country's annual tea production in 2021-2022 coming from Assam, followed by West Bengal, the northern part of India is the biggest producer. The Assam valley and Cachar are the two tea-producing districts in Assam. The three main tea-producing regions in West Bengal are Dooars, Terai, and Darjeeling.?