India's Tea Industry | 25 Sep 2025

Source: TH

Why in News?

According to the Executive Director of the International Tea Committee, India has the potential to become a global tea superpower, supported by its strong production capacity, large consumption base, and growing export opportunities. 

What are the Key Facts Regarding Tea?

• About: Tea is a beverage made from the Camellia sinensis plant and is the world’s most consumed drink after water.
• Tea Board of India: Established under the Tea Act of 1953, it is a statutory body under the Ministry of Commerce with its head office in Kolkata and overseas offices in London, Dubai, and Moscow.
  • Provides financial and technical support for the cultivation, production, and marketing of tea.
• Growth Conditions: 
  • Climate: Tea is a tropical and sub-tropical crop that thrives in hot, humid conditions.
  • Temperature: It grows best between 20°–30°C, while temperatures above 35°C or below 10°C can damage the plant.
  • Rainfall: Requires 150–300 cm of well-distributed rainfall annually.
  • Soil: Prefers slightly acidic, calcium-free soil with a porous sub-soil to allow free water percolation.
•  Factors Contributing to the Crisis in Industry:
  • Weather-Driven Decline: Extreme heat in May 2024 followed by flooding in Assam cut India’s tea production by 30% to 90.92 million kg, its lowest in over a decade.
  • Supply-Demand Imbalance: There is a growing gap between the demand for tea and its supply, creating further pressure on the industry.
  • Stagnant Prices: Assam, which accounts for 55% of India’s tea production, has been particularly affected by stagnant prices.
    Intense Competition: India is facing stiff competition from other major tea-producing countries like Kenya.
  • Rising Input Costs: Over the past decade, the costs of essential inputs have increased by 9-15%, while tea prices have only risen by 4%. 
    • The ban on 20 pesticides raised tea prices due to costly alternatives further straining the profitability of the sector.

How can India Ensure the Sustainability of its Tea Industry?

• Shift to Quality & Value Addition: Promote GI-tagged, specialty, and branded teas for better export prices.
• Diversify Export Markets: Target South America, Middle East, and Africa to reduce reliance on volatile markets.
• Boost Domestic Consumption: Increase per capita intake through marketing, ready-to-drink (RTD), flavored, and wellness teas.
• Improve Farm-Gate Value: Ensure small growers receive a fairer share via direct markets, Farmer Producer Organizations, (FPOs), and transparent auctions.
• Learning from Other Countries: Equip farmers to produce high-quality, sustainable tea; Kenya’s Farmer Field Schools (FFSs) provide hands-on training in planting, fine-plucking, and certification preparation.

Conclusion

The Indian tea industry stands at a crossroads, balancing its global potential against severe challenges like climate vulnerability and low value realization. Achieving sustainable profitability requires a strategic shift from volume to quality, empowering small growers, and innovating for both export and domestic markets.