TEA

Introduction
Tea is one of the important beverages in this world. India and China are the major
tea producing countries of the world. India and China are also the major tea
exporters in this world. The Tea industry is playing a very important role in tea
producing countries because it provides a source of major income for the country.
Tea is one of the oldest industries in India and today it enjoys the status of one of
the best organized industries in the country. Although tea has been known since
2737 B.C. and consumed as a beverage for 1250 years, its cultivation in India
commenced very recently. The discovery of indigenous tea in Assam in 1823 led to
the foundation of the tea industry in India. Further, certain varieties of tea are grown
only in India and are in great demand across the world. All Darjeeling teas possess
the lightness of flavour and fine colouring that set them apart from all other teas.

Origin
Although tea is produced in 14 States in India, Assam and West Bengal (WB) in
North India; and
Tamil Nadu (TN), Kerala and Karnataka in South India are the five most important
States producing
around 98.6% of Indias tea production. Tea is also grown on a small scale in a few
other states viz.,
Tripura, Arunachal Pradesh, Karnataka, Himachal Pradesh (HP), Uttaranchal, Sikkim,
Bihar,
Manipur, Orissa and Nagaland.
Although North India accounts for around 7577% of Indias tea production,
depending on the year
and market conditions, around 8590% of North Indian tea production is consumed
in the domestic
market. The balance, much of it of high quality, is exported. Although South India
accounts for
around 2325% of Indias tea production, around 3050% of its production is
exported. Depending
on the year, South India accounts for around 50% of Indias tea exports by volume.

Composition

Market overview
The Tea Industry in India derives its importance by being one of the major foreign
exchange earner and for playing a vital role towards employment generation as the
industry is highly labour intensive. India is the second largest producer of tea in the
world and contributes to around 30% of the global tea production. The market size
of tea is estimated to be approx.10,000 Crore with a penetration of more than 90%
in the domestic market. With an export of approx. 210 million kg of tea, India stands
as the fourth largest exporter of tea in the world with China ranking at the first
position. In India more than 50% sales of tea is routed through auction at various
auction centres located in North & South India. Prices are bound to remain firm this
year due to strong domestic demand as well increase in the demand from the
export market. Last year due to agro climatic conditions, the production was below
the standard production which left the demand unmet.

Export procedure
Tea Board of India
The Board was set up under the provision of Tea Act 1953 and it started functioning
in April 1954. Its headquarters are in Kolkata with seventeen offices across India.
Apart from various developmental and regulatory functions, the Tea Board of India
undertakes direct promotional activities, which include organising joint participation
in international fairs and exhibitions, arranging buyer-seller meets and sending and
hosting trade delegations. The Board also undertakes various market development
activities such as market surveys, market analysis, tracking of consumer behaviour
and dissemination of all relevant information to exporters/importers.
Export procedure describes the documents required for exporting from India.
Special documents may be required depending on the type of product or
destination. Certain export products may require a quality control
inspection certificate from the Export Inspection Agency. Some food
and pharmaceutical products may require a health or sanitary certificate for export.

The Shipping Bill or The Bill of Export is the main document required by the
Customs Authority for allowing shipment. Usually the Shipping Bill is of four types
and the major distinction lies with regard to the goods being subject to certain
conditions which are mentioned below:

Export duty

Free of duty

Entitlement of duty drawback

Entitlement of credit of duty under DEPB Scheme

Re-export of imported goods

The following are the export documents required for the processing of the
Shipping Bill:

GR forms for shipment to all the countries.

4 copies of the packing list mentioning the contents, quantity, gross and net
weight of each package.

4 copies of invoices which contains all relevant particulars like number of

packages, quantity, unit rate, total f.o.b./ c.i.f. value, correct & full description of
goods etc.

Contract, L/ C, Purchase Order of the overseas buyer.

AR4 and invoice.

Inspection/ Examination Certificate.

The formats presented for the Shipping Bill are as given below

White Shipping Bill in triplicate for export of duty free of goods.

Green Shipping Bill in quadruplicate for the export of goods which are under
claim for duty drawback.

Yellow Shipping Bill in triplicate for the export of dutiable goods.

Blue Shipping Bill in 7 copies for exports under the DEPB scheme

For the goods which are cleared by Land Customs, Bill of Export is required instead
of Shipping Bill.

The Government of India has framed several schemes to promote exports and to
obtain foreign exchange. These schemes grants incentive and other benefits. The
few important export incentives, from the point of view of indirect taxes are given
below:

Free Trade Zones (FTZ)

Electronic Hardware Technology Park / Software Technology Parks
Advance License / Duty Exemption Entitlement Scheme (DEEC)
Export Promotion Capital Goods Scheme (EPCG)
Deemed Exports
Manufacture Under Bond
Duty Drawback