Tea entrepreneurs have demanded the resumption and continuation of the export subsidy program from the fiscal year 2081/82, especially targeting tea exported to third countries.
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Tea producers and businessmen are concerned after the government announced the suspension of the export cash incentive program that has been providing for the promotion of Nepali tea exports.
The entrepreneurs have also submitted a letter of appeal to the Ministry of Agriculture and Livestock Development, the Ministry of Industry, Commerce and Supplies, and the Ministry of Labor, Employment and Supplies. In the letter of appeal they sent to the Government of Nepal, it is mentioned that although export subsidy was received in the fiscal years 2078/79 and 2079/80, the tea industry has been affected due to the lack of continuous provision of this facility in recent fiscal years.
As mentioned in the letter of appeal submitted to the ministry by the Suryodaya Orthodox Tea Producers Association Nepal of Ilam, Nepali tea has been mainly exported to third countries including India. The association says that export subsidy has been making a significant contribution to the development, expansion of the tea industry and the livelihood of farmers and entrepreneurs. However, the association has warned that the current lack of export cash incentives may have a negative impact on production, exports and national production.
The association has demanded that the export subsidy program be resumed and continued from the fiscal year 2081/82, especially targeting tea exported to third countries. In addition, the government has been urged to formulate a policy with the aim of increasing exports in accordance with the principle of equal treatment. The letter has also been sent to the Secretary of the Ministry of Agriculture and Livestock Development and the Executive Director of the National Tea and Coffee Development Board.
Gyani Limbu, Vice President of Suryodaya Orthodox Tea Producers Association Nepal, said that if the currently proposed export-related procedure is implemented as it is, 95-97 percent of entrepreneurs in the Nepali tea industry will be directly affected. 'If this procedure is implemented, the situation of selling Nepal's tea abroad will be even weaker,' he said. 'When less than 2 percent of tea is already being exported to third countries, such a policy is an attack on the industry.'
Vice President Limbu said that the banking system and state services have not been able to provide much relief to the tea industry. Recalling that the agricultural subsidy of interest exemption that farmers have been receiving in the past has helped greatly in expanding tea cultivation, he stressed that it should be continued. He said that the role of the state is necessary to make the tea sector feel that they are also part of it.
He said that a relief package with at least interest relief is very necessary for farmers in the current situation. According to him, the state is now targeting tea, far from providing direct subsidies or concessions, and has even been cutting the facilities it was already providing. “The state’s presence is not visible for the tea sector,” he complained.
Limbu says that the quality of Nepali tea is competitive at the global level. Presenting the fact that Nepali tea is earning a name by winning gold and silver medals in international competitions including the US and China, he said, ‘Our tea is not weak in quality, the weakness lies in our publicity and state support.’
Currently, about 95 percent of the market for Nepali tea is India. But Limbu’s analysis is that this dependence has become the biggest risk for the industry. ‘India occasionally obstructs the border, stops it at customs, and makes various excuses,’ said Vice President Limbu. Stating that tea cultivation in Darjeeling and Ilam is in the same climate, he said that Nepali tea is even better and therefore competitive in quality. But he alleged that the Indian side has shown a tendency to stop tea during the main season of production citing non-technical reasons.
He said that although the government has adopted a policy to encourage the export of Nepali tea to third countries, it is not possible for all tea to go to third countries immediately.
He proposed that Suryodaya Municipality should be declared an organic zone like Sikkim and farmers and industry should be assisted in certification. He also pointed out the need to strengthen the monitoring system from production to market.
