Growth of imports shake tea gardens of northern Bangladesh
When people think of tea gardens, they immediately think of Sylhet or Chittagong. But these are not the only districts which are producing tea in Bangladesh. The extreme northern districts, Tetulia and Bediaganj to be exact have joined in. They have been cultivating tea on plain lands since 2000. But its history in the areas dates back to 1996. Five officials from Sylhet's Srimangal Tea Board came here on a visit and found a forest plant called 'Phutki'. The fact that this land could grow 'Phutki' was an indicator of potential of tea cultivation. Today, I'll tell you the story of tea-farmers of the north, their livelihood and how they are making a living from tea cultivation.
If you look at the tea gardens, you won't believe that you are looking at the northern part of Bangladesh. The northern districts are usually regarded to as the region of hunger, poverty and monga (extreme poverty). The sight of tea gardens are contrary to that impression. People never thought that tea could ever be an agricultural product here and tea was only used as raw material for the industrial goods. But now it's a hub for the investments from big industrialists and has huge commercial potential. Farmers were involved with the sector just to give their labour. Sylhet tea gardens have established this idea for the past 180 years. However, in Panchagarh, the notions have changed dramatically.
During 2005, many people started getting involved in tea cultivation, nurseries and its related industries. Like the tea-hillocks of Sylhet, here in Tetulia, you can smell the pure and fresh tea leaves in the very air you breathe. People here used to grow vegetables and mostly potatoes in the past. Now, all the lands have been converted into tea gardens.
During the past twelve years, the people of this region have seen a positive change. Like the green tea leaves, farmers' dream are also becoming broader and bigger. They didn't really think through the subtleties of commerce agriculture properly. So, those who have a small piece of land started their very own small tea plot. Now, the whole region is filled with green. At the moment, there are around 500 tea-farmers in Panchagarh. Farmers in Thakurgaon and Lalmonirhat nearby have also started tea cultivation. Overall, the total number of tea farmers in the region is around 600, who are cultivating tea on around 5000 acres of land in the region. Large part of this land belongs to the farmers.
I spoke to Abdul Jabbar, a farmer from Panchagarh's Podiaganj who converted his vegetable lands to tea farming plots.
“Why did you feel the interest to cultivate tea?”
“Everyone said tea cultivation will be more profitable. It's also very easy to cultivate. But the profits are as expected.”
“I'm not getting the fair price for the tea-leaves. There is too much import. The price used to be Tk. 26.50 per kg, which has come down to to Tk. 20. Also, the factory owners want 40% for free.”
Statistics tell us in 2013, Panchagarh has produced 1.64 million KGs of quality fine tea. During 2014, the district had a target of 1.7 million KGs and in 2015 the target is to reach more than 1.9 million KGs. I attended a discussion among tea farmers and factories to understand the core problems.
“Tea is being imported from India, Vietnam and Kenya at a very low price. That's why farmers can't sell the tea for a good price at the auction”, says a local farmer.
“When farmers take the tea leaves to the factories, before unloading they tell the farmers if they give them 40% for free, only then factories will buy from farmers. There is no second place where we can take these”, says another farmer.
“What is the reason?”
“They say there is water in the leaves, and it's poor in quality. The factory owners feel that they don't need as much anymore, then they talk about the 40% cut to discourage the sellers.”
“The main reason behind this is the three factories are already closed. So, it's kind of an overload for the remaining factories and farmers can't preserve the leaves so they get ruined. Some are sending their leaves to Tetulia.” says a factory owner.
The gist of the discussion was although Bangladesh achieved remarkable tea production over the past twenty-five years, commercial success is not as high as people may think. During the 90s, Bangladesh was the fifth largest exporter of tea. However, the country has lost that dignity. Now, we import tea from abroad. Against a demand of 61 million KGs, Bangladesh already produces 63 million KGs of tea. But local producers are not being protected from imports. During 2010, the country used to import 2.9 million KGs of tea, which has soared up to 10 million KGs in 2013.
“Import duty was 92% on the cost price. Over this, there was a supplementary duty of about 20%. All of a sudden, government had taken off the 20% duty. Later on the import duty came down to 72%. In India, the duty is 110% and in Sri Lanka, its 130%. High imports are ruining local tea cultivations”, says another tea farmer.
The discussion clearly indicated that Bangladesh is importing tea quite unnecessarily. At the auction market, the tea price is poor. Thirdly, there is now agricultural credit facility for tea farmers.
Tto investigate why farmers get unfair price, I went to visit Tetulia Tea Company Limited to talk with the company manager, Mizanur Rahman.
“Why you are giving farmers a low price?
“The quality of the leaves is not good.”
“Can't you train them to produce better quality?”
“We're trying our best.”
Bangladesh used to export tea a few years back. That same Bangladesh is now importing tea. There is logic of import when there is lack of produce. But when the country has sufficient local produce, there is a need to discourage imports. The government should forecast the impact of changing tariff on certain products and realize the economic benefits of increasing tariff on tea imports. They must work to ensure that the local production and industries survive.
What'll be the future of the progressive tea sector of the extreme northern district of Bangladesh? Will there be no light for the hardworking tea farmers, labourers and factory owners here? This is where the survival of our significant cash crop comes in front of doubts and dilemmas. I had the opportunity to bring this issue to Tofail Ahmed, the Honourable Commerce Minister,.
“As per the rule of WTO, we can't completely shut down imports. We discourage import by only putting supplementary duty over it”, he said. “As the Commerce Minister my duty is to make sure that people can buy what they need regularly. If we increase the supplementary duty and close the import, then people will have to pay a high price for tea. We have to take realistic measures considering both the parties- producers and consumers”, adds Tofail Ahmed.
I firmly believe the Ministry of Commerce will take the right initiative to ensure that tea production sector becomes sustainable. If imports cannot be reduced, perhaps there need to be measures to ensure that local producers can produce at a lower cost, enabling them to better compete with cheaper imports. A government processing centre and a proper mechanism of getting fair price is important. In the age of globalization and open market economy, producers and relevant stakeholders are exposed to changes in the global scenario. There is no denying that over time, each country needs to become more and more open to the world economy is order to keep growing – but this cannot come at the cost of farmers losing their income. In the end, the commercial future of Bangladesh is slowly being driven more and more by foreign forces, such as imports. Local competiveness needs to be ensured to shift the power back to local producers. The government must look intensely into these vital issues immediately. Or else, similar to the fate of the sugar industry, the bicentennial heritage of tea cultivation of Bangladesh will fade away gradually in days to come.