A cuppa that brings hope

After years of clamouring for help to deal with the cost increase, the Foreign Trade Policy has offset some of it with the export of tea being brought under the Vishesh Krishi and Gram Udyog Yojana (VKGUY), which offers a 5 per cent incentive.

Aditya Khaitan, chairman of the Indian Tea Association (ITA), said it would result in a 5 per cent credit duty drawback on the free on board (FOB) value, which would offset some of the rising costs like transportation.

For exporters getting Duty Entitlement Passbook (DEPB) benefits in excess of 1 per cent, the incentive would be limited to 3 per cent, said Basudeb Banerjee, chairman, Tea Board of India.

He added that the incentive in monetary terms should translate to Rs 50-120 crore for tea exports, depending on the value of the commodity. The move would also incentivise exports of higher value of tea. “This was a long-standing demand of the tea industry and the Tea Board,” said Banerjee.

The measures announced in the policy were: minimum value addition under the advance authorisation scheme for tea exports reduced from 100 per cent to 50 per cent.