{"id":176068,"date":"2005-08-25T00:00:00","date_gmt":"2005-08-24T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/shri-r-prabhu-called-the-attention-of-the-minister-of-commerce-and-on-25-august-2005"},"modified":"2017-04-21T15:14:54","modified_gmt":"2017-04-21T09:44:54","slug":"shri-r-prabhu-called-the-attention-of-the-minister-of-commerce-and-on-25-august-2005","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/shri-r-prabhu-called-the-attention-of-the-minister-of-commerce-and-on-25-august-2005","title":{"rendered":"Shri R. Prabhu Called The Attention Of The Minister Of Commerce And … on 25 August, 2005"},"content":{"rendered":"
Lok Sabha Debates<\/div>\n
Shri R. Prabhu Called The Attention Of The Minister Of Commerce And … on 25 August, 2005<\/div>\n
<\/pre>\n
Title <\/a>:  Shri R. Prabhu called the attention of the Minister of Commerce and Industry to the situation arising out of unprecedented fall in price of Green Tea Leaves particularly in Nilgiri Hill District of Tamil Nadu causing hardships to the small tea growers and steps taken by the Government in regard thereto.\n<\/p>\n
\u00a0  <\/p>\n
\u00a0  <\/p>\n
MR. SPEAKER<\/a>: Item No. 35.\n<\/p>\n
Shri K. Subbarayan \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 —\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Not present.\n<\/p>\n
Shri R. Prabhu.\n<\/p>\n
SHRI R. PRABHU <\/a>(NILGIRIS<\/a>): Sir, I call the attention of the Minister of Commerce and Industry to the following matter of urgent public importance and request that he may make a statement thereon: 01 <\/p>\n
\u201cThe situation arising out of unprecedented fall in price of green Tea leaves particularly in Nilgiri hill district of Tamil Nadu causing hardships to the small Tea growers and steps taken by the Government in regard thereto.\u201d  <\/p>\n
\u00a0  <\/p>\n
THE MINISTER OF COMMERCE & INDUSTRY (SHRI KAMAL NATH): Hon. Speaker, Sir, in recent years, the prices of tea have generally been depressed. Even though during the year 2004, the average all-India auction price registered some increase after five years of depressed prices, the prices have come down thereafter.\u00a0The all-India average auction price of tea during January to July 2005 was about Rs.58\/- per kg., as compared to the average price of about Rs.60\/- per kg in 2004 for the corresponding period. The decline in prices has been more pronounced in the case of South India. The average auction price of tea in South India which was about Rs.49\/- in January 2005 as compared to the average price of about Rs.43\/- per kg in January 2004, fell to below Rs.36\/- in July 2005, after reaching a peak of about Rs.51\/- in March 2005.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The small tea growers in Nilgiris district in Tamil Nadu, who account for nearly 40 per cent of the tea production of the district, were also affected as the average green leaf price also declined along with the prices of made tea.\u00a0 The   <\/p>\n
* Placed in Library, See No. LT 2827\/2005
\n prices of green leaf in other parts of the country have declined to some extent, but the fall has been the highest in the Nilgiris area.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The drop in prices could party be attributed to the profusion in growth of leaf during the peak cropping season which has led to increased plucking and at the same time to comparatively poor quality of green leaf plucked for supply to the processing factories.\u00a0 It would appear that excess leaf was brought to the factories in expectation of better prices which resulted in the fall.\u00a0 However, it would be worthwhile to note that good quality leaf continues to get reasonably good prices and better quality made tea also fetches good prices despite the decline in average prices.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 In order to address the issues of quality, the Tea Board has launched a Quality Awareness Programme in July 2000 in the Nilgiris, and it is being continued till date.\u00a0 This programme is being implemented in collaboration with the UPASI Krishi Vigyan Kendra, the Department of Horticulture, Government of Tamil Nadu.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The Bought Leaf Factories that have been associated with the Quality Awareness Programme have started procuring selectively good quality leaf and pay the growers higher prices. Because of the prices fetched by some of these factories for made tea, the green leaf price paid to small growers in June 2005 by these factories has been as high as Rs.8.50 per kg., for quality leaf, whereas poor quality leaf has fetched half that price[KMR7]\u00a0.\n<\/p>\n
The Nilgiris Small Tea Growers’ Association and the hon. Member of Parliament, Shri R. Prabhu have from time to time and have very recently requested that a minimum price be fixed for green tea and also for made tea.\u00a0 It may not be easy to fix one minimum price for made tea as the price depends on differences in categories – Whole, Broken, Fannings and Dust – which again have different grade variations.\u00a0 There are also different manufactured types of tea such as orthodox and CTC. More importantly, again, quality also is significant in the price that a particular tea fetches in the market.\n<\/p>\n
The quality of tea ultimately depends on the quality of green tea leaf plucked and supplied.\u00a0 If a minimum price for green tea leaf is fixed and if the cost of production of made tea, on the basis of the price of the green leaf used as input, is higher than the price buyers are willing to pay, then such manufacturing units may not be able to purchase the green tea leaf at a price already fixed.\n<\/p>\n
In addition to the efforts of the Tea Board to persuade the factories to produce quality tea, it has become necessary to enforce quality norms which conform to standards laid down under the Prevention of Food Adulteration Act.\u00a0 Various steps have been initiated by the Tea Board in this regard, including action against those factories which have been found to have produced substandard tea.\n<\/p>\n
Sir, I share the concerns of the hon. Members who have raised this issue.\u00a0 The Government is keeping a close watch on the situation.\n<\/p>\n
\u00a0  <\/p>\n
SHRI R. PRABHU <\/a>: Mr. Speaker, Sir, I would like to thank you for accepting this Calling Attention Motion, which is going to affect the livelihood of the people of Nilgiris district.\u00a0 Like the hon. Minister has stated, tea is one of the most consumed beverages in this country and also abroad, next only to the consumption of water.\u00a0\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Nilgiris district in South India has the unique distinction of being the first district in South India to start tea production. It goes way back to 1835.\u00a0 For the nearly last two centuries they have been producing tea.\u00a0 They have 45,000 hectares of tea plantations.\u00a0 They produce 70 million kilograms per year. Like the hon. Minister has said, 40 per cent of the tea grown in the Nilgiris is by small tea growers, who own marginal farms from 10 cents to about five acres.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The hon. Minister is aware that for the last seven or eight years, there has been a crisis in the tea industry.\u00a0 As soon as this Congress-led UPA Government came into office, the hon. Minister’s first action was to give interim relief to the small tea growers.\u00a0 He gave a subsidy of Rs.2 per kilogram for four months last year.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, the hon. Minister has appreciated the problem of the tea industry and he has summarised it and said that there is excess production and the supply is greater than the demand.\u00a0 Taking advantage of this situation, the bottle leaf factories who process the small growers teas has suppressed the price.\u00a0 The hon. Minister has just stated that good quality tea leaves get a price of Rs.8.50 but you find a factory nearby this factory paying only Rs.2 or Rs.3.\u00a0 This is because the factories which get lesser quality of green leaf reduce the price and the ones getting better leaf also through these factories take advantage and reduce the price to Rs.3.\u00a0 Tea is also sold through auctions there.\u00a0 Ninety per cent of the tea is sold through auctions.\u00a0 In the auctions, there is collusion between the brokers and the buyers and the bottle leaf factories.\u00a0 In the Nilgiris district, brokers give huge sums of money to the bottle leaf factories as loans at higher rates of interest.\u00a0 Because of that, they are able to manipulate the prices in the auctions.\u00a0The hon. Minister has stated that it would be difficult to get a minimum support price.\u00a0 We have been agitating for this for a long time.\u00a0 But I would like to remind him that the Tea Act of 1953 envisages a minimum support price or a maximum price of tea[R8]\u00a0.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, the Tea Marketing Control Order under which the auctions take place is very clear.\u00a0 Section 30(1)(a) of the Tea Act, 1953 gives the power to the Central Government to fix a minimum or a maximum price for tea sold by auctions or otherwise.\u00a0 I would like the hon. Minister to refer to this and accept fixing a minimum statutory price for the small tea growers of tea leaves, in principle.\u00a0 If he accepts this, in principle, he could make an Expert Group to fine tune with modalities.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 I would also request the hon. Minister to ask STC and MMTC to intervene in the auctions and procure tea at a fair price.\u00a0 The Defence makes a lot of purchases of tea, and it is nearly 7 million kilograms per year.\u00a0 Now, the Defence purchases are made by STC and MMTC through agents. Here, I would request the hon. Minister to request MMTC to directly intervene in the auctions and also the Defence services to directly procure tea from the small tea growers in co-factories, which are the co-operative factories in Nilgiris.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Now, the hon. Minister said about quality.\u00a0 Naturally, once the minimum statutory price is fixed,\u00a0the factories themselves would grade the leaves and within one or two years, the quality would improve.\u00a0 Also, the pruning and rejuvenation of the leaves should take place, and the small growers should be encouraged and\u00a0 given a one-time subsidy of Rs. 7,500 per acre, to have a rejuvenation programme and pruning programme.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, in December, 2004, the hon. Minister was kind enough to call all MPs from the tea growing areas and had a meeting, where a lot of suggestions were put-forth, a lot of decisions were taken, and a lot of decisions are under consideration.\u00a0 One of the important points that I had made at that time was that, I requested the hon. Minister to have a Small Tea Grower Development Agency under the Tea Board to look into the problems of the small tea growers.\u00a0 In my constituency alone, there are 65,000 small tea growers, and they belong to a particular community \u2013 a hill tribe community, and their livelihood is only from the small tea gardens.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, we have the office of the Tea Board in Coonoor.\u00a0Now, the hon. Minister has just stated that the Tea Board is responsible for looking at the quality, and they have a Food Adulteration Act.\u00a0 They are supposed to take action on the tea factories, which do not conform, to these regulations.\u00a0 But unfortunately, there is not enough support staff in the Tea Board in Coonoor.\u00a0Therefore, I would request the hon. Minister to look into this and see that enough support staff is given for them to be more effective.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, in conclusion, recently, we had made a request to the hon. Minister from all parties in Tamil Nadu including all our 40 MPs. We had requested him to have an interim relief given to the small tea growers.\u00a0 We had requested him to give Rs. 5\/- as subsidy per kilogram for, at least, four to five months.\u00a0 But unfortunately, the State Government has jumped in the fray and given a subsidy of Rs. 1.50 per kilogram, and it is asking the Central Government to reimburse that.\u00a0 I would request the hon. Minister, whether he reimburses it or not, to give an additional subsidy of Rs. 3\/- per kilogram for the small tea growers.\n<\/p>\n
\u00a0I would request him again to kindly consider announcing a statutory minimum support price for the small tea growers.\n<\/p>\n
MR. SPEAKER<\/a>:\u00a0 Now, two more hon. Members would be permitted, just to put one question each on this Calling Attention.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Shri M.P. Veerendra Kumar, you gave your notice at 10 a.m. today.\u00a0Please ask only one question.\n<\/p>\n
SHRI M.P. VEERENDRA KUMAR Yes, Sir, I would ask only one clarificatory question.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Hon. Speaker, Sir, Kerala is also affected as other States are affected, due to unprecedented fall in price of green tea leaves.\u00a0 It is a crisis.\u00a0\u00a0 In Kerala, some of the estates are closed.\u00a0\u00a0 I have got the information that one Padur plantation is closed for the last two years, and due to which thousands of tea workers are in absolute poverty.\u00a0 Therefore, would the Union Government take up with the Government of Kerala to see why this plantation is closed?\n<\/p>\n
MR. SPEAKER<\/a>:\u00a0 Mr. Krishnaswamy, your notice was received at 12.42 hours.\u00a0 But because it is almost at the end of the Session, I am allowing you.\u00a0 But in future, it would not be done. One has to given notice, in time.\u00a0 You have to ask only one question, please.\n<\/p>\n
\u00a0  <\/p>\n
SHRI A. KRISHNASWAMY Thank you. Sir, our leader Dr. Kalignar has also written a letter to the Central Government in this regard.\u00a0 Three to four years back, the same situation arose. At that time, our hon. leader, Murasoli Maran was the Minister of Commerce.\u00a0 At that time, there was a subsidy of Rs. 2 per kilogram.\u00a0 So, I want to know whether that would be announced now also.\n<\/p>\n
\u00a0  <\/p>\n
MR. SPEAKER<\/a>:\u00a0 You want a subsidy of Rs. 2 per kilogram.\n<\/p>\n
SHRI A. KRISHNASWAMY <\/a>:\u00a0 Yes, Sir[k9]\u00a0.\n<\/p>\n
SHRI KAMAL NATH<\/a>: Sir, hon. Member, who has drawn the attention to this issue from time to time, brought this to my notice.\u00a0 As he has mentioned, I had a meeting with the MPs of that area.\u00a0 I also, for the first time, held a Stakeholders Conference covering all the facets of tea not only for the Nilgiri area also for the areas of Assam, Darjiling and Jalpaiguri also and tried to look at this holistically.\u00a0\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Decline of prices in Nilgiri is only a part of the problem, which the tea industry faces.\u00a0 As I have said many times on the floor of the House, the tea industry has undergone a dramatic change not only because of the gardens getting old, bushes not being rejuvenated but by the new events also that are taking place.\u00a0Small-tea growers and the production, which has increased in Kenya and Sri Lanka are another phenomena. Kenya and Sri Lanka used to be very small producers of tea.\u00a0 But today, though they are not quite up to India, they have reached very close to the Indian tea production.\u00a0\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, the quality and the prices are determined by the quality of the green leaves.\u00a0 As I have stated in my statement, prices for good quality green leaves have not declined so much.\u00a0 The hon. Member has very correctly pointed out – I appreciate the Member\u2019s concern – that the prices have declined.\u00a0 But for quality leaves, prices have not declined like that.\u00a0 Why have they declined?\u00a0 They have declined only because the growers have been plucking more leaves. If they are supposed to pluck two leaves, they have plucked eight leaves.\u00a0 In anticipation of getting a good price, they have plucked even those leaves which should not have been plucked.\u00a0 When they take those leaves to the tea factories, their prices obviously will be much less.\u00a0 This is the real problem. This problem has to be addressed.\u00a0 A Quality Awareness Programme was launched.\u00a0 By virtue of this, we are succeeding in it and making the growers conscious of the fact that plucking   <\/p>\n
more does not mean getting more money.\u00a0 It may mean more leaves but it does not mean a better price.\u00a0 So, this Quality Awareness Programme lies at the heart of solving this problem.\u00a0\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, the hon. Member has also talked about minimum statutory prices.\u00a0 I must say that – and I cannot refrain from saying this \u2013 in February last year, after the announcement of the elections, the Government of the day at that time announced a scheme, which the Central Election Commission did not agree.\u00a0 They announced a subsidy scheme only for four months covering the period starting from the announcement of the elections to the date of the polls.\u00a0 Sir, these measures don\u2019t solve the problem.\u00a0 If a support price or a minimum price is given, the tea factories will have to pay that price for bad quality tea also.\u00a0 It would encourage the growers to pluck anything and everything.\u00a0As I have informed the House, PFA also comes into play here.\u00a0 So, as regards minimum support prices, we will be happy to have a discussion with the hon. Member and the hon. Members, who are concerned with this issue, and also other stakeholders from Nilgiri.\u00a0\n<\/p>\n
SHRI M.P. VEERENDRA KUMAR <\/a>: What about Kerala?\n<\/p>\n
SHRI KAMAL NATH<\/a>: I am coming to Kerala.\u00a0 Let me first deal with Nilgiri.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 To come to a long-term viable solution of this problem, if the hon. Member invites me, I will be happy to go there and sit with all the concerned to find a solution.\u00a0 I do appreciate the concern of the Members that this is a problem and it should be addressed.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, regarding using of agents in these auctions, I will direct the STC and the MMTC to participate in these auctions to see that the objective of these auctions is rightly achieved.\u00a0\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sir, I will also ensure that the Quality Awareness Programme is trimmed up wherever necessary.\u00a0 If there is any suggestion, I will look into that[pkp10]\u00a0.\u00a0\u00a0\n<\/p>\n
\u00a0  <\/p>\n
\u00a0   <\/p>\n
 13.00 hrs.[R11]\u00a0 <\/p>\n
\u00a0  <\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 As far as the Tea Board\u2019s support staff is concerned, the hon. Member has drawn my attention to it saying that the Tea Board\u2019s support staff is not there, I would say that whatever inadequacy is there, if any, I will have a look at it.\n<\/p>\n
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The other hon. Member has said that there are closed factories or closed plantations factories in Kerala. I will take this issue up with the State Government. Whatever the State Government and the Central Government can do in this, as per the suggestion of the hon. Member, if it is workable, we will consider it.\n<\/p>\n
SHRI R. PRABHU <\/a>: Sir, I invite the hon. Minister to come to my Constituency.\n<\/p>\n
MR. SPEAKER<\/a>: Okay. The only thing is that he is waiting for your invitation.\n<\/p>\n
SHRI R. PRABHU <\/a>: Sir, I invite him on the floor of this House.\n<\/p>\n
\u00a0  <\/p>\n
       \u00a0  <\/p>\n","protected":false},"excerpt":{"rendered":"
Lok Sabha Debates Shri R. Prabhu Called The Attention Of The Minister Of Commerce And … on 25 August, 2005 Title : Shri R. Prabhu called the attention of the Minister of Commerce and Industry to the situation arising out of unprecedented fall in price of Green Tea Leaves particularly in Nilgiri Hill District of […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-176068","post","type-post","status-publish","format-standard","hentry","category-judgements"],"yoast_head":"\nShri R. 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