To prevent COVID 19 tides, a lockdown was announced first in March 2020. This was also the time when the tea industry was gearing up to start all over again as directed by the Tea Board. However, the lockdown got extended for another 14 days, which was effective till 14th April.
According to the Tea Association of India (TAI), the complete lockdown effective from the 24th of March 2020 has impacted the tea industry very seriously. The worse being the liquidity crunch which disallows most transactions.
1. Production Hit
The tea gardens literally started operations again in Assam with only 50 % of workers and with only 25% of workers in West Bengal. This brought about a horrible situation for the tea plantation business at least in the year 2020. The gardens had to compromise to maintain proper plucking schedules. This resulted in a great loss of manufactured tea & exports. An estimate of the lost production can be calculated to a tune of 110mkgs as per the numbers revealed by the Tea Association. This has never been the condition of a tea plantation business at all, it has been an ‘all-weather’ occupation always.
In the backdrop of the situation discussed the tea industry has been witnessing frequent fluctuation in the market prices. With the workforce below the normal capacity, the production & operations will face grave consequences. The association has pleaded for a comprehensive financial package that covers interest subvention, enhancement of working capital limit, payment relief of electricity charges, and provident fund dues which has been presented before the Union Government and respective State Governments.
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The situation is such that the industry is left no more self-reliant. Though, the industry stays optimistic about the exports to do. In fact, the Govt has been found responsive to the damage caused to the Tea industry. It is looking after both the states of Assam and West Bengal & and thereby is looking forward to supporting the industry is quickly picking up operations & catching the momentum as before.
2. Financial Losses
For the city of Darjeeling, huge losses have come uninvited from the times of violent Gorkhaland agitation & now it’s the lockdown due to the Covid19 pandemic. This lockdown has hit the tea industry based in West Bengal and Assam quite hard. It has resulted in revenue losses of a whopping Rs 2,100 crore, according to the report submitted by the Indian Tea Association last month.
Nearly 1,000 tea gardens in both states have lost their ‘first crème’ ’, which majorly contributes to their total revenue. This starts with typical harvesting in the month of March, but due to continuous lockdown, zero human movement, and the social distancing norms, the work couldn’t be resumed on time which pushed production digits further away.
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