KARACHI, April 21: An Indian tea delegation arrived in Lahore to hold talks with the representatives of Pakistan tea industry aimed at augmenting tea trade between the two countries. Ten members of the delegation arrived on Saturday while four more members will join them soon.

Chairman Indian Tea Board (ITB) Basudeb Banerje is leading the delegation with members of Indian Tea Association (ITA), comprising of packers, producers, blenders and exporters. The delegation will also visit Karachi and Peshawar to seek business opportunities with their Pakistani counterparts.

Because of frequent exchanges between Pakistani and Indian tea trade leaders – Indian tea export to Pakistan has been showing slight improvement over the last few years.

In 2004 during the visit of an Indian delegation a memorandum of understanding (MoU) was signed between the stakeholders of the two countries, which were aimed at facilitating tea trade between the two countries. However, the Indian team flew back without striking any deal or business contract with Pakistani side.

One of the main points of the MoU was that the PTA would ensure that tea imports from India would reach a level of 25 million kg over the period of three years (2004-05 to 2006-07).

However, tea trade between the two sides could not attain the level of 25 million kg in 2006-07. According to figures of Pakistan Tea Association (PTA) tea imports from India during July-March 2006-07 stood at 9.2m kg as compared to 7.96 million kg in the same period of 2005-06.

Indian tea is usually imported for blending purpose with costly tea of Kenya.

Chairman PTA Hamid Khawaja told Dawn from Lahore that the Indian delegation had arrived after two years. Last year, a PTA delegation had visited India.

He said so far it was not clear whether the two sides will sign a memorandum of understanding (MoU). Also there is no schedule of signing any deal or contract among the counterparts. It is a routine visit by the Indian delegation.

Pakistan’s total tea imports during July-March 2006-07 declined to 82.5 million kg ($151.5 million) from 93.7 million kg ($151.6 million) in the same period of 2005-06 in which imports from Kenya stood at 47 million kg ($96 million) in the last nine months as compared to 55.3 million kg ($100 million) in corresponding period of last year.

Pakistan meets its black tea requirement from 21 countries. The share of packers and importers/dealers is 50 per cent each of the total tea imports.

According to Mr Hamid Pakistan’s total tea consumption now stands at 170 million kg out of total annual import of over 100 million kg. He claimed that the 60-70 million kg now arrive through illegal channels under the garb of Afghan Transit Trade (ATT) mainly in loose form.

The cumulative duties and taxes on legal imports come to 34 per cent while smugglers bring in the loose tea through ATT with only 8-10 per cent cost.