Industry representatives said India’s tea industry is facing increasing financial stress due to rising input costs, stagnant prices, labor shortage and climate-related risks, forcing planters to look for policy support and structural reforms to maintain operations.
Uttam Chakraborty, president of the North Bengal branch of the Tea Association of India, said, “Many estates were being forced to sell tea at below cost, leading to over-borrowing and financial stress. Unless we produce high-quality tea and bring remunerative prices, sustainability is impossible.”
He said the share of wages in production costs is around 60 per cent, making the sector highly sensitive to wage revisions and input inflation. The costs of fertiliser, coal, pesticides and electricity have increased rapidly in recent years, with electricity alone estimated at around Rs 10-11 per kg of tea.
Association president Shailja Mehta said the industry is grappling with a long-term imbalance between cost growth and price growth.
“It is important to strike a balance between cost of production and value realization,” he said, calling for a minimum sustainable price mechanism to ensure viable returns to producers.
He highlighted the economic importance of the region at the recent North Bengal Chapter AGM, saying that the tea ecosystem in the northern part of West Bengal supports about 32 lakh people, or about 28 per cent of the region’s population.
Industry officials said labor availability has become a major operational challenge, with some estates reporting 25-50 percent absenteeism during peak production periods, forcing them to rely on external labor at high costs. Climate variability, including irregular rainfall, rising temperatures and pest infestations, are further affecting yields and quality.
Planters have urged Tea Board India to expedite release of pending subsidies, interest subvention on working capital loans and financial incentives for specialty tea production and machinery upgradation. They also want organized tea growers to be allowed access to the schemes of the Ministry of Agriculture and Farmers Welfare, arguing that tea cultivation is primarily agricultural in nature.
The industry association has also demanded lower electricity tariffs to reduce energy costs and prompt implementation of solar power provisions notified by the West Bengal Electricity Regulatory Commission.
Stakeholders said cheap imports and mislabelling of Indian origin on blended teas were causing losses to domestic producers and called for tight monitoring to protect quality standards and export credibility.
India is the world’s second largest tea producer and the sector directly employs over one million workers.
Published on February 15, 2026
