The Nilgiri Bought Leaf Tea Manufacturers Association has voiced concerns about significant differences in the manner in which policies of the Tea Board are enforced between North and South India.

Citing a partial and uneven approach in policy implementation, the association pointed out that this has adversely affected the South Indian bought leaf tea sector.

In a representation submitted to the visiting Commerce Minister, Piyush Goyal, the association pointed out that the auction systems followed in the North and South are different. The billing methodology adopted for South India differs from that followed in the North and the average price fixation mechanisms applied to South India are also different.

Unequal market conditions

These disparities have resulted in unequal market conditions and have placed South Indian bought leaf tea manufacturers at a significant disadvantage, affecting the sustainability of the industry. A uniform and fair policy framework across regions is essential for ensuring balanced growth of the Indian tea sector, Dhanjayan Krishnamurthy, president of the association, said in the representation. 

The continued delay in implementing approved reforms, coupled with regional policy disparities, is pushing the sector towards serious economic instability. The association also sought the intervention of the Minister in safeguarding the livelihoods of lakhs of small tea growers and strengthening the rural economy of Tamil Nadu.

The existing auction system continues to be influenced by a limited number of dominant buyers, resulting in unsustainable price realization for producers. This has placed tremendous financial pressure on small tea growers and bought leaf tea manufacturers, threatening the livelihood of lakhs of rural families dependent on tea cultivation and manufacturing, he said.

Ensurancing sustainable auction system

He said that bought leaf tea manufacturers occupy a unique position in the tea value chain as they are the only stakeholders legally mandated to share revenue with small tea growers. Therefore, ensuring a fair and sustainable auction system is essential not only for the survival of manufacturers but also for the economic security of growers and workers, he said.

While major reforms were discussed and approved in principle at various meetings of the Tea Board over the past two years, there has been no meaningful progress or sustained initiative to implement these reforms in a time-bound and effective manner.

While organizations such as UPASI, ITA, and TAI are represented, the bought leaf sector, which together with small tea growers contributes nearly 60 per cent of India’s tea production remains excluded from decision-making processes that directly affect its survival.

Published on April 21, 2026