Indian tea industry concerned over higher US tariff, exports likely to hit

The tea industry in India on Monday expressed concern over the imposition of higher tariffs by US President Donald Trump, stating that the hike in levy is likely to have an impact on exports of the beverage to that country.

Leading industry body Indian Tea Association (ITA) said the US is a significant market for Indian tea.

In 2024, the US had imported 17 million kilograms of tea from India, while the shipment to America stands at 6.26 million kilograms till May this year, according to the industry body.

The additional 25 per cent tariff by the US on Indian products for the country's purchases of Russian oil came into effect on August 27, bringing the total amount of levy imposed on New Delhi to 50 per cent.

 

The tea industry association said that the recent imposition of 50 per cent tariff on Indian goods would be a "limiting factor for exports of the beverage to the US".

The association said that persistent decline in tea prices, influx of imports and export market volatility pose an existential threat to the tea industry in West Bengal and Assam.

The ITA has already put forward its demand for the implementation of a minimum sustainable price (MSP) for tea to protect the interests of the industry and also to ensure its long-term sustainability.

The association also said orthodox tea production should be incentivised to meet the growing global demand for this variety.

It has also demanded that the government ensure a level playing field in the export market to compete with Sri Lanka and Indonesia, as the governments of these two countries offer subsidies and other export incentives.

The association has also called for restraining low-quality tea imports and revision of trade pacts like the Indo-Nepal treaty.