The Bangladesh Tea Board (BTB) wants to have tea recognised as an agricultural item to help boost the industry and overcome the existing crises, sources say.
In a letter, it recently requested the commerce ministry to discuss this at a cabinet meeting. However, it has been pressing the government to this end for a long time.
Agricultural items, including pulse, oilseed, spice, and maize, are entitled to bank loans of a 4.0 per cent interest rate. But that is not the case with tea as it is not classified as an agricultural product.
The tea board claimed it is possible to make tea a sustainable and profitable industry if it is categorised as an agricultural item and lower-interest loans are provided.
Tea in Bangladesh is known as a labour-intensive, export-oriented, and import-substituting industry. It plays a special role in the economy by being an import-substitute item, fetching export earnings, and alleviating poverty by providing employment for unskilled population in remote areas.
In 2023, some 102.93 million kg of tea was produced in the country. Of that, 101.89 million kg was used for domestic consumption and the rest was exported, BTB data shows.
The tea auction price was Tk 171.24 per kg in that season. Accordingly, the auction value of 102.93 million kg of tea was Tk 17.62 billion. The domestic consumption portion was valued at Tk 17.44 billion and the export portion at Tk 178 million.
The BTB letter to the commerce ministry said if tea production is interrupted or reduced, the volume that has to be imported will cost about Tk 10-20 billion in foreign exchanges annually.
Field-level work at tea gardens, namely producing tea seedlings, planting, maintenance, pruning, and plucking, is 60 per cent of the industry's total activities and categorised as agricultural work. Processing green tea leaves accounts for the remaining 40 per cent, which is industrial work, the letter said.
To maintain employment and a fair working environment as well as receive lower-interest loans, tea should be categorised as a 100 per cent agricultural item, BTB noted.
"We recently received the BTB letter. We plan to write to the agricultural ministry soon in this regard," a commerce ministry official said.
Commercial tea cultivation started in Bangladesh in the 19th century for the purpose of exports.
Due to economic development, urbanisation, and an increase in per capita income, tea consumption per capita has increased many times. As a result, almost 99 per cent of the total production in 2023 was used for domestic consumption.
Tea production in the country increased by almost 50 per cent in the last 10 years. But due to the increase in fertiliser, pesticide, gas, and electricity prices as well as workers' wages, production costs also went up.
On the other hand, tea prices at auction did not increase at that rate. As a result, it has become difficult for planters to meet their operating expenses due to reduced income, industry insiders say.
Most tea estates are struggling to pay workers' wages regularly. This caused labour unrest and led to the closure of many plantations, such as those of National Tea Company, according to insiders.
Earlier, the standing committee on the environment ministry suggested recognising rubber as an agricultural item.
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