Kanan Devan Planters Association has urged the Union and State Governments to put in place immediate relief measures to safeguard the tea plantations from the crisis the industry is facing.
Fall in prices, increase in wages and high cost of fertilisers is taking back the industry to its worst-ever period tea growers had experienced at the beginning of this century, BP Kariappa, Chairman of the Association, said in a statement.
Tea prices in the South are unviable with the average price up to September dropping below ₹100 from ₹115 per kg during the same period a year ago, down 13 per cent. At the same time, wages have gone up by 19 per cent in Kerala. The increase in wages coupled with spiralling costs of other inputs have crippled the tea plantations, which is on the verge of collapse. In addition to the basic wages, the organised plantation sector spends additional 75 per cent for discharging the obligation of social costs. The recommendations and assurances given by many expert committees for reimbursing part of the expenses incurred for social costs still remain in paper, he said.
An unfavourable tax environment further aggravates the situation where the cost structure already places the products on a weak grounding
Agriculture I-T Likewise the agriculture income tax is levied at the rate as high as 50 per cent in Kerala against nil in Tamil Nadu. While 30 per cent is levied in Karnataka, Assam and West Bengal. Apart from this, the basic land tax increase from ₹200 to ₹500 per hectare has also an impact on the sector, he said.
Kerala has the highest plantation wages coupled with a variable DA which is revised quarterly. This had an impact on wages, which increased by 18.34 per cent in the past two years, whereas the tea prices dropped 13 per cent, he said.