India’s tea industry is poised for growth in the global market. In 2024, India ranked second in tea production and consumption and third in exports. The country produced 1.303 billion kilograms of tea and consumed 1.22 billion kilograms domestically. Despite being a top exporter, India’s export value remains lower than some competitors due to quality and market reach.
Global Tea Production and Consumption
The total global tea output in 2024 was 7.074 billion kilograms. Global consumption was nearly equal, at 6.97 billion kilograms. India contributed a substantial share with over 1.3 billion kilograms produced. It also consumed most of its production domestically, reflecting strong internal demand.
India’s Export Position
India is the third-largest tea exporter, shipping 255 million kilograms valued at about $800 million. Kenya leads as the largest exporter, sending nearly all its production abroad. China, the second-largest exporter, consumes much of its tea locally. Sri Lanka exported 245 million kilograms worth $1.4 billion, showing higher export value despite lower volume than India.
Quality and Market Expansion
India’s export earnings lag behind Sri Lanka despite higher export volume. This gap is due to the focus on quality and market diversification. Experts suggest India should improve tea quality to gain better prices. Expanding into new markets such as South America and Africa could boost exports and revenue.
Domestic Consumption Trends
Indian consumers are increasingly willing to pay more for premium tea. Current per capita consumption is 840 grams annually. This is low compared to Turkey, which leads globally with 3 kilograms per person yearly. If India raises its per capita consumption to 1 kilogram, it could consume its entire production domestically, reducing reliance on exports.
Future Potential of Indian Tea Sector
India has all the necessary ingredients to become a superpower in the tea industry. Growth in domestic consumption and export quality improvement are key drivers. The Indian tea sector can leverage its production scale and rising consumer preference for quality to expand globally.
Questions for UPSC:
- Discuss in the light of India’s tea industry how agricultural exports impact the country’s economy and trade balance.
- Critically examine the role of quality improvement and market diversification in enhancing India’s position in global agricultural exports.
- Explain the factors influencing domestic consumption patterns of agricultural commodities in India and their implications for production planning.
- With suitable examples, discuss the challenges and opportunities in promoting Indian agricultural products in emerging markets like Africa and South America.
