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G.K. Nair

Kochi, Nov 21 Turkey besides being a potential market for Indian tea could act as a gateway to European Union as well as Central Asia provided greater initiatives are taken by the country’s tea industry.

In fact, Turkey with a per capita consumption of 2.5 kg a year, is the fifth largest consumer of tea in the world and its estimated annual consumption is 175-200 million kgs, Mr N. Dharmaraj, Convenor, Golden Leaf India Awards: Southern Tea competition (TGLIA:STC), who recently participated at an exhibition in Istanbul told Business Line on Tuesday.

Besides, he said, teas produced in Turkey appeared to be of inferior quality and also not internationally competitive. “We had collected some details on the retail price from the market which indicates that the retail prices are in the range of Rs 300-350 per kg.” This, he said, suggests a huge possibility for India tea to enter the domestic market, apart from the possibility of exporting through free trade zones for re-exports.

The Upasi pavilion set up at the space provided by the India Tea Board at the GIDA International Food and Beverage Exhibition held in Istanbul from October 31 to November 4 received good response. In fact, 60 prospective buyers visited the Upasi pavilion where the prize-winning teas of the second and third editions of TGLIA:STC were displayed, he said.

Apart from the Tea Board and Upasi, Harrisons Malayalam Ltd and Premier Tea Company participated in the fair through the Tea Board stand.

There were many Turkey-based tea companies, including CAYCUR, EYFEL, DOGUS, ALKOSAY (UAE-based) and BETA apart from Sri Lanka Tea Board, that participated in the exhibition.

Mr Dharmaraj said Turkey’s production during 2006 was 142 mkg from a total area of 79,000 hectares. The imports into Turkey are estimated at 6 mkg through the official route, and nearly 20-25 mkg are being imported through illegal channels. This is mainly due to the high import duty of 145 per cent. Besides the import duty, there is also a value added tax at 18 per cent for bulk teas and 8 per cent on packet teas.

Besides, “our discussions with some of the private producers, especially Mr Ayhan Rusen of Selen and Company, were very informative and provided some important information about the Turkey tea market. The private sector has been representing to the Government for more liberalisation and with Turkey joining the European Union, the liberalisation is expected to be faster and would result in reduction of duty rates in due course”.

Apart from the tariff barriers, there are certain non-tariff barriers such as port restrictions. The Turkey Government allows imports only through Rize port, which is near the Black Sea area, where warehouse infrastructure is not adequate and that adds to the cost component.

According to Mr Dharmaraj, Mr Ayhan Rusen also suggested the need for bilateral discussion at the Government level to sort out these issues so that more teas from India could be imported into Turkey.

Teas consumed by Turkey are largely PEKOE grades and OP1, OPA, BOP grades. Leaf appearance should be blackish and consistent leaf characteristics.

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