SUTANUKA GHOSAL
Calcutta, Aug. 22: Union commerce minister Kamal Nath will lobby for a cut in import duty on Indian tea exports to Pakistan at the G20 summit to be held between September 7 and 9.
At present, Indian tea exports to Pakistan attract an import duty of 10 per cent. While the basic import duty on tea is 10 per cent, the country has allowed tea imports at ‘zero’ duty from Bangladesh, Nepal and, recently, Sri Lanka, subject to a limit of 10 million kg from each country.
Commerce ministry sources said the ‘zero’ duty benefit for the other countries is adversely affecting India’s competitiveness in the Pakistan tea market.
A senior official of the commerce ministry said the Indian tea industry has made several representations to the ministry on the issue. “Based on their pleas, the government has decided to take up the matter with Pakistan,” he added.
Suresh Bansal, president of the Tea Association of India, said: “We met the minister and requested him to take up the issue with Pakistan, which is one of the large tea-importing countries in the world. Moreover, Pakistan’s tea consumption is mainly of the CTC variety, where our production far exceeds demand.”
Pakistan is a captive market with logistic and freight advantages across the western border. However, the market share of Indian tea there is only 4-4.5 million kg out of a total 140 million kg. In 2003-04 and 2004-05, Pakistan imported 6.5 million kg and 4.2 million kg of Indian tea.
Pakistan, generally, imports tea from Sri Lanka and Africa, especially Kenya, overlooking the prospects of sourcing it from India due to strained political and economic ties. (mes)
Source : http://www.telegraphindia.com
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