Kalyan Nanda is a well-known tea industry consultant. BE’s Kishore Kumar Biswas spoke to him.
Q . How did China supersede India in tea production and export?
A. For the last few years, I am not too concerned with Chinese tea production. However, India and China share age-old intimate links pertaining to the tea industry. In my experience, one should not accept all the data given by the Chinese. But I cannot give you the exact data on Chinese tea production to prove my proposition. What I want to tell you is that Chinese data on tea - regarding its exports or production - is doubtful.
At the same time, one has to keep in mind that China is doing very well in the global tea industry. It is mainly concerned with production of green tea. But as different varieties of tea are gaining prominence, China is successfully adjusting to those emerging trends as well. China is now producing instant tea and black tea in a big way.
Q. You had been associated with supplying tea pro-duction machinery for years. What types of machines are being preferred by the Chinese? Is it different from the machinery in Indian processing units?
A. We have supplied tea producing machines according to the need of our clients. When Chinese producers demanded machines to produce CTC tea or dust tea, we had to supply machines according to those requirements. These two types of tea are needed for making tea bags. The orthodox variety of tea is not suitable for making tea bags. Apart from China, we have supplied machines to various other countries as well.
Q. Why have Chinese producers who are famous for industrial development, bought machines from Indian manufacturers?
A. It is really very interesting. Actually, Chinese supremacy in the industrial sector is mainly due to its scale of production. But in tea production, very big amounts of machinery are not needed. So, it is economic for them to buy from offshore companies.
Q. How are Chinese producers competitive in the international market regarding pricing?
A. I think the Chinese are not at all bothered about the pricing of tea. It is a labour intensive sector and the Chinese are more concerned with employment generation. It should be noted that China also has a huge small tea plantation sector. Small producers supply tea leaves to factories at regulated prices. In tea gardens, labourers are not always working professionally. In many cases, families are involved in tea cultivation and in China land is the property of the government. In the last five to ten years, 15% or 20% of land has been given as lease to planters. Even today, most of the tea plantations are under the government. Therefore, the production system is not much different from the Indian system.
Q. Why has Chinese tea production increased so significantly over the last decade?
A. Actually, there is some history behind this. Earlier, a large number of people of Myanmar origin grew tea in south-eastern China. But due to some political reasons, those tea growers had to leave China. Therefore production was stopped in that region. But tea production in the region re-started at a later phase by the Chinese authorities and that has ensured the sudden jump in tea production in China.
Q. Please explain the emergence of Sri Lanka and Kenya as important players in the global tea market.
A. There are many factors involved but you have to note one thing. That is the cleanliness of the factories. You will be surprised to see most of the factory premises in these countries. Sri Lanka has been a big exporter of tea. It has been able to brand its tea very well. As India’s export is 20% of the total tea production, Indian producers have less interest in branding.
Q. Why is India not able to export a substantial portion of its tea production?
A. India’s exports to West Asia. Earlier, the centre of this trade was Amritsar and other bordering outlets but now it has shifted to Dubai. We have also lost our Russian market to a great extent. In this situation, Kenya has gained a vast area for its tea exports.