Kochi: The tea replantation and rejuvenation programme, which was launched in Assam and West Bengal in April, will finally come to south India in the first week of January.

The aim is to address a major problem afflicting the tea industry—the ageing of tea bushes, leading to a decline in quality and productivity.

The Union government has created a Rs4,761 crore special purpose tea fund for the programme.

Tea growers in the south were not happy with the fund that the government wanted to allocate for each hectare of tea estate for replanting tea bushes. They demanded that the government cultivation and trade promotion body, Tea Board of India, take into consideration the huge labour cost for uprooting the tea bushes and replanting them in the hilly terrains of south India.

Revival time: A tea estate in Tamil Nadu. The commerce minister says 20 estates from the state have applied for the government initiative.

While 50% of the cost would be in the form of loans, 25% would come from the government as subsidy and the difference would be borne by the estate owners.

Jairam Ramesh, minister of state for commerce, will formally launch the programme on 4 January in Coimbatore, Tamil Nadu. According to Ramesh, there are 41 applications from south India so far; 21 from Kerala and 20 from Tamil Nadu. “It will usher in a sea change in productivity and production in the tea gardens across India," says Ramesh.

Meanwhile, tea production has dropped more than 20 million kg in the first 10 months of 2007. According to Tea Board officials, the total tea production during January-October is 802.56 million kg, down from 822.72 million kg in the first 10 months of last year.

Output has fallen by 13.56 million kg in the north (Assam and West Bengal) and 6.6 million kg in the south (Tamil Nadu, Kerala and Karnataka). Exports have also clocked a drop of more 41 million kg during January-October, from 173.92 million in the year-ago period, to 132.25 million kg.

Manojit Dasgupta, secretary general of the Indian Tea Association, the forum of tea growers in the north, says weather played a spoilsport and brought down tea production.

A dry spell prevailed in the beginning of the year and the monsoon was poorly distributed in the north, while there were heavy rains in Assam. In addition, the lack of adequate sunlight affected the growth of tea leaves, adds Dasgupta.

Ullas Menon, secretary general of growers’ body, United Planters Association of Southern India, says heavy rains spread over nearly six months in Kerala affected the crop yields. According to Dasgupta, 42 million kg of tea was exported to Iraq during 2006, but exporters have not yet received their payments.

Traders are staying away from Iraq and this has brought down the exports this year. “Better Kenyan crop has seen its produce going to Pakistan, but India is compensating this through new markets, such as Egypt and Iran," Dasgupta says. Incidentally, tea imports have also been down this year.

Figures up to September indicate imports to be down to 10.92 million kg, compared with 16.77 million kg during January-September 2006.

Total imports during 2007 were 24 million kg. Dasgupta expects this to be less than 15 million kg this year.