India's tea traders express mixed reactions over retail reforms

Coimbatore, Sep 24 (ANI): Indian tea traders have given a mixed reaction to the Central Government's decision to allow Foreign Direct Investment in multi-brand retail.

The Chairman of the Tea Trade Association of Coimbatore, N Anand, said the government should not bring any such policy into the agricultural sector. He said tea should not be taken into this foray, as the sector is currently not prepared to take such a risk.

"The government's policy on FDI, which has come up as a surprise to all of us, is definitely going to create a negative impact on the (tea) trade. We are kind of confused. To be very frank, we don't know where we stand as retailers, as producers, as marketers, in the world market or, within the country, where our strength is," he said.

"We are very strong within the country, we don't know where this will take us, because we will have bigger players in the market and they will have a very good impact with their money power, they will have a major impact on the trade and industry," he added.

However, the executive director of the Tea Board of India, R Ambalavanan, said this policy would bring quality oriented market.

"Though I cannot comment on the policy framework of the government, but one point is very clear, that without testing this policy as to how it is going to function, we cannot conclude, and secondly, it will not affect the small people definitely," he said.

"And, it will definitely give a quality oriented market. So, people who are looking for quality, can definitely get the benefit of these FDI outlets, and, this will also create the gap between the poor and the rich," Ambalavanan added.

India is one of the major producers and exporters of tea in the world market.

India's tea production rose for the first time in nine months in June to 122.2 million kilograms, up 6.5 percent from a year earlier, as plucking improved in northeastern and southern parts of the country, the state-run Tea Board informed in a statement.

However, the country's tea production in the first six months of 2012 fell 5.7 percent on year to 338 million kilograms as unfavourable weather in the top-producing state Assam hampered plucking earlier this year. (ANI)