Assam’s Tea Industry Needs A Helping Hand

Posted by Saurav Uprety
August 13, 2017

Assam is one state among seven sisters in Northeastern India with an economy based on agriculture. Assam’s biggest contribution to the world is Assam Tea, and it plays a vital role.

While most of the states in India are gradually moving away from their conventional agricultural based economy towards a secondary or service-oriented economy, Assam is still laboriously reliant on the agricultural sector. Compared to most other states in India, it is considered as less flourish state which depicts a dingy picture of the economic condition of Assam.

Assam produces both food and cash crops. Although rice is staple crop of Assam its productivity over the years has not increased while the other crops have seen a slight rise in both yield and land acreage. Tea is the principal cash crop is Assam and well known globally for its idiosyncratic palate. However, the exploitation of both precious land and workforce by the tea venture, most of which are foreign owned or belong to Indian conglomerates is well documented.

The economy of Assam is contingent on the primary sector or agriculture, but it faces many difficulties for the upliftment of the economy. Continuing to rely on seasonal monsoon water for cultivation is another attribute for farming in Assam. V.K.R.V Rao, an eminent economist, says, “Agricultural development problems and economic development issues are the two sides of the same coin, both go hand in hand. Prominence should be given to agriculture for economic development. There are many reasons for the primitiveness of farming, like natural calamities, capital deficiency, marketing problem, R&D, land reforms, information gap, out dated thinking, prejudiced cultural values, etc. However, there are problems like lack of entrepreneur and managerial talent, poor economic infrastructure, government bureaucracy and political unrest. These discourage investors so the state should step in to fill the gap which is left unfulfilled by the private sector.”

The tea industry in Assam is about 172 years old. It occupies a prominent place and plays an instrumental part in the national economy. Assam contributes 15.6% of world’s tea production & 55% of India’s tea output. But over the years, there have been many challenges faced by Assam’s tea industry. The biggest problem is the high cost of production and low price realisation. Tea is a major foreign revenue earner for India and has an equally significant role in Assam’s economy. However, things are not as bright as it seems to be. The Assam tea industry is gradually sinking due to various problems being faced by it.

Problems With The Assam Tea Industry:

1. Low Tea Price: Due to different causes, the tea price of the tea has seen a steady decline over the years. All the profits from the tea gardens were syphoned off, and there was no real or proper reinvestment in improving the quality of tea. There has been a major crisis in the Assam tea industry, which resulted in closing down of the tea gardens.

2. Labour issues: It is a labour-intensive industry, and so there have been agitations for better pay & working conditions.

3. Less production of tea: Multiple problems are being faced by the tea industry such as financial crisis, power issues, labour problems, poor labour schemes, inadequate communication system, increased revenue tax for tea gardens, increased pollution fee, less transport subsidy, etc.

4. Changing Climate: Changing climatic conditions owing to scanty or very heavy rainfall have severely affected the tea industry and its production.

5. No proper storage: The problem of storing premium quality tea has always been there. Due to delay in transportation and lack of storage facilities the green leaf of tea wasted time to time.

6. Government’s negligence: There is no any proper strategy on Assam tea industry by the state & as well as central govt. It might also be hampering this industry.

7. Others: Lack of proper communication for export, limited use of scientific tool or mechanisms, insufficient capital to invest, decline the interest on the agricultural field among the youth, growth of industries, etc. are also seen as the major obstacles to the growth of tea industry in Assam.

Suggestions To Be Adopted:

After the discussion of the problems some of the important recommendation & measures to be adopted for the betterment of the tea industry of Assam are as:

1. Increasing global demand for Assam tea has raised the hopes of the industry.

2. Venturing into new markets in the global market to regain its demand.

3. Favorable export condition and domestic market promotion can also benefit the industry.

4. Diversification of tea leave products can open up new avenues.

5. The government should properly set the plans & policies regarding the Assam’s tea industry.

6. Improved supply chain and storage management will enhance shelf life.

7. The tea labourer’s condition should be enhanced. Their socioeconomic and health condition should also be improved.

8. Various management programs should be initiated by the industry as well as by the government to develop the capabilities of the tea executives.

9. The government should also provide the individual loans or plans some special scheme for the tea production.

We may say that amidst continued problem there is still optimism for future and a chance and potential for primary sector to uplift the economy of Assam.


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