Raju Sahu, a former Congresss MLA from Panitola in Tinsukia, and Secretary of the local chapter of Assam Chah Mazdoor Sangha (ACMS) — the largest union in organised tea sector — became household name in the country’s largest tea producing State over the last couple of days.

In a Whatsapp video message, Sahu made a case for forcing small growers — contributing 40 per cent to the total production — to pay similar wages and benefits as in the organised sector. The cost disadvantage, he says, may kill the organised sector, throwing livelihood of nearly 10 lakh people in jeopardy.

Small growers’ advantage

Sahu didn’t mention it. But the real trigger behind the message is the BJP government’s election promise to offer organised tea workers a daily cash wage of ₹350, up from the current ₹137.

Including the 12.5 per cent statutory contribution, bonus and non-cash benefits the total daily wage in Assam is estimated at ₹220.

The problem: small growers hardly operate by this rule. The cost advantage helps them to offload teas at a low price and earn decent profits, while the organised sector suffers from rising costs and stagnant prices. “We will not survive paying ₹350 a day cash wage plus other benefits,” says Topojit Bagchi, owner of Phukanbari tea estate near Dibrugarh.

It is not yet known if the Sarbananda Sonowal government will stick to its election promise. The former Tarun Gogoi government of the Congress too wanted to increase wages to ₹300 a day, but backtracked in the face of opposition within the party.

Tea wages to soar

Tea workers are, however, bullish that the BJP government will live up to its promises. The sentiments particularly improved after the Sonowal government stuck to its promise to reward workers for operating their bank accounts, opened during the demonetisation.

All eligible workers were recently paid ₹2,500 each. Another ₹2,500 will be paid in tranches. They are now eagerly awaiting the ongoing negotiations for the new agreement to be over. The last agreement expired in December.

The sentiment in Assam has caught up with West Bengal tea workers too. After the initial resistance, they have accepted the State government’s offer of ₹26.5 a day (including ₹9 a day foodgrains subsidy) interim increase in cash wage to ₹159 a day, up from ₹132 a day.

But workers want more and are now monitoring the development in Assam closely.

Better weather

They had a bad year in 2017, particularly due to inclement weather conditions. There was poor rain in April-May and June witnessed excess rainfall, impacting the major second flush production.

While national production witnessed a rise of 12 million kg (mkg) to 1,279 mkg in 2017; Assam suffered a 15 mkg drop in output to 653 mkg. “In comparison, rainfall conditions have remained better so far in 2018. But due to extra cold, it didn’t result in higher crop. Our March production is behind last year,” says Vivek Kumar Goenka, Executive Director of Kolkata-based Warren Tea that has seven estates in Assam.

Meanwhile, prices suffered as buyers are apparently deferring purchases in anticipation of a higher crop and a lower price. “I sold teas from Hookhmol estate at ₹280 a kg in March 2017. Prices this year are down to approximately ₹275 a kg,” says owner Bhaskar Hazarika of Assam.

GST, a boon

If there is any good news for planters in this challenging times, that’s GST. “It has made life much simpler,” says Bagchi. The initial hiccups notwithstanding, Bagchi didn’t lose any money due to GST introduction last year. As the problems are ironed out, he is now a happy user.

Hazarika echoes similar sentiments. “I am in love with GST. It took me 10 minutes to file the new e-way bill,” he said, recalling his harrowing experience with tax authorities in the past.

There is, however, a flip side. There is a proportionate rise in inspector raj from other departments. The tea industry is governed by a host of State laws concerning labour, fire safety and so on. Apparently, those departments have become hyperactive.

Related Topics
comment COMMENT NOW