Amid growing concerns over the sharp rise in tea imports and its adverse impact on the Indian tea market, the Tea Association of India (TAI) has formally urged the Director General of Foreign Trade (DGFT) to review and regulate the duty-free import of tea under the Advance Authorization Scheme and Special Economic Zones (SEZ) provisions.
In a letter dated June 10, 2025, TAI highlighted that a steady surge in tea imports has led to serious market distortions, affecting domestic prices and producers. Data from the Tea Board of India shows that India imported 23.65 million kilograms (M.Kgs) of tea in 2023, with a CIF value of ₹363.07 crore. Alarmingly, tea exports from Kenya alone surged to 17.13 M.Kgs in 2024—a staggering 226% increase from the previous year. By March 2025, Kenya had already exported 3.9 M.Kgs to India, up 117% year-on-year.
The association noted that despite Tea Board directives to curb domestic production from November 30, 2024, and a 110 M.Kgs production shortfall due to inclement weather, a surge in imports post-September 2024 pushed prices down by an average of ₹60. This wiped out gains from efforts to balance supply and demand.
TAI expressed apprehension that some exporters are abusing duty-free schemes by importing low-cost teas, blending them with Indian teas, and re-exporting them under Indian origin labels—thereby damaging India’s global tea reputation. Moreover, a large portion of such imports may be entering the domestic market, evading the 100% import duty and undercutting local producers.
“There’s currently no transparent system to track how much imported tea is re-exported and how much is sold domestically,” TAI stated, warning of potential misuse of government schemes.
In its appeal to DGFT, TAI proposed:
- Disallowing duty-free imports of tea under Advance Authorization and SEZ schemes.
- Allowing imports only after payment of full duties, with refunds provided after verifiable export.
- Implementing a standard operating procedure (SOP), similar to Sri Lanka’s model, to ensure traceability, adherence to FSSAI norms, and prevention of domestic diversion.
TAI President Sandeep Singhania emphasized that these measures are essential to protect the interests of Indian tea producers and maintain the authenticity and global reputation of Indian teas.
