Reforms for sustainability of Assam Tea

The recommendation by the Parliamentary Standing Committee on Commerce to expedite the implementation of the Tea
Reforms for sustainability of Assam Tea

The recommendation by the Parliamentary Standing Committee on Commerce to expedite the implementation of the Tea (Promotion and Development) Bill along with other draft bills on coffee, rubber, and spices has given new impetus to the proposed reforms in the tea sector. With celebrations to mark 200 years of Assam tea underway, the ramifications of the new law on the industry will be keenly watched by all stakeholders. The salient features of the bill, according to the Commerce Ministry, include reduction of compliance burden for the industry, enhancement of ease of doing business, decriminalisation of offences, replacement of licencing with easy one-time registrations for stakeholders, and reconstitution of the Tea Board to provide optimal representation to various stakeholders (including mandatory representation of women). The bill also envisages industry promotion and development with minimum regulations to drive growth and development of tea. The final draught of the bill is expected to be ready after the completion of the interministerial consultation on comments and suggestions from over 100 stakeholders, including state governments, associations, organisations, and the general public. The proposed law seeks to take away the regulatory powers of the Tea Board as a licensor and mandate it to play a more facilitative role and engage in overall promotion and development of the tea sector (including promotion of Indian tea in both domestic and international markets) and tea research. The existing legislation, The Tea Act, 1953, mandates the Tea Board to deal with matters relating to control over extension of tea cultivation, management or control of tea undertakings, control over tea export and tea seeds, etc. Explaining the rationale for the repeal of the current Act, the draft bill states that there has been a paradigm shift as to how tea is grown, marketed, and consumed, and this necessitates the amendment of the existing Act. Besides, the legal regime has to be enabled to address several areas of modern functions of the Tea Board, such as support for production, extension, quality improvement, promotion of tea, and skill development of tea growers, which were not included in its mandate, states the draft bill. While enactment of the proposed legislation is pending, the government has already pushed for some reforms in the tea sector. These include making small tea growers who contribute around 52% of the total tea produced in India the focal point in the developmental schemes for financial assistance, the periodicity of renewal of registration/licenses have been raised and format of such applications have been simplified as part of ease of doing business, grant of financial assistance and registration/licenses have been made online, rules of tea auction have been reformed for better price discovery and the strength of manpower of Tea Board has been reworked to reduce establishment cost. Large tea gardens account for about 53% of the about 700 million kg of tea produced in Assam but have 67% of the total area under tea in the state. Small tea gardens, on the other hand, have 33% of the total area under tea but account for 47% of tea production in the state because of their much higher productivity compared to large tea gardens. The workers in the tea industry are key stakeholders, but the trade unions have cautioned against hurriedly passing the bill without addressing the issues of workers and other stakeholders. They have expressed apprehension that the exclusion of Chapter 3 of the Tea Act, relating to control over the extension of tea cultivation, in the draft bill potentially open 4.2 lakh hectares of land under tea cultivation for competitive commercial avenues. The existing law says that no one shall plant tea on any land not planted with tea on the date of commencement of The Tea Act, 1953, unless permission has been granted in writing by or on behalf of the Tea Board. The trade unions have also flagged the issue of a new law addressing the issue of tea workers’ rights. Assam has 4.56 lakh permanent tea garden workers and an almost equal number of temporary workers employed by registered tea gardens. Permanent workers are entitled to various social benefits, including rations, provident funds, gratuities, paid maternity leave, yearly bonuses, etc., apart from their daily wage. About 5 lakh workers in small tea gardens are paid only the daily wage and are not provided any social benefit, which has kept them as the most vulnerable stakeholder in the tea industry. Small tea growers getting remunerative prices for green leaves is essential to providing social benefits in addition to wages. The proposed legislation ensuring fair wages and a social protection net for garden workers, large and small, will be crucial for addressing the concerns of all stakeholders. Withdrawal of temporary tea workers from daily-wage work in gardens and shifting to other unorganised sectors that pay higher daily wages has already led to labour shortages during pea seasons. The proposed legislative reforms addressing such challenges will be crucial for the sustainability of Assam tea.

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