India resumes mandatory quality testing, disrupting Nepali tea exports again

Nepali tea exporters are once again facing significant disruptions as Indian authorities have reinstated mandatory sampling and laboratory testing for tea shipments from Nepal. This marks the second such hurdle within a fortnight, leading Indian buyers to halt purchases and casting a shadow over the country's export sector.

According to Shiva Kumar Gupta, senior vice-president of the Nepal Tea Planters Association, Indian traders have become hesitant to buy Nepali tea since the Tea Board of India began collecting samples from buyers' warehouses. Sales are now contingent on laboratory approval, a process that has created considerable uncertainty. "It has been four to five days since Indian traders stopped buying tea from Nepali suppliers," Gupta stated, highlighting the immediate impact of the renewed testing requirements.

The current restrictions primarily affect orthodox tea exports, as production of crush, tear and curl (CTC) tea has already seen a substantial decline this season due to lower availability of green leaves. This situation adds to the existing pressures on Nepal's tea industry, which experienced a 25-30 percent drop in production last fiscal year because of looper pest infestations. Rising production costs have also prompted many farmers to consider alternative crops.

Initially, India had implemented a mandatory testing regime for all imported tea, including from Nepal, on May 1, citing a need for enhanced quality control. This move severely disrupted exports, prompting diplomatic discussions between Kathmandu and New Delhi. A subsequent revision on May 20 exempted tea intended for domestic consumption in India from mandatory testing, though tea for re-export remained subject to requirements. The latest resumption of testing has effectively reversed this relief, leaving Nepali producers and exporters in a precarious position.

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It has been four to five days since Indian traders stopped buying tea from Nepali suppliers. The Tea Board has started collecting samples from buyers' warehouses and has allowed sales only after laboratory approval.