PT Siganporia, deputy managing director of Tata Tea, the world’s largest integrated tea group, swears by the FMCG maxim that it’s lot easier to regain a customer who moved away than creating a new one. He has to be a believer for Tata Tea harvests nearly 29 million kg of the beverage at its estates in Kerala and Tamil Nadu out of its total all-India production of about 54 million kg. There are a number of consumer pockets here and abroad where south Indian teas were replaced by teas of other origins.

Auction houses, where the final judgement on quality on lines of teas is passed, will, however, confirm that Tata Tea initiative to improve the standards of its south Indian beverage are yielding good results as reflected in the progressive improvement of auction rankings and higher unit value realisation. Tata Tea, as industry officials acknowledge, leads the quality campaign in south India, which saw a marked decline in standards of tea since 1980s.

Tata Tea says its south Indian teas "command a distinct price premium in the auction room." While the claim is not disputed, it should be seen against the fact that the average auction price of south Indian teas in the first half of 2002 fell 12.88 per cent to Rs.42.13 a kg. Some lines sold at less than Rs.37 a kg, which is significantly below the production cost.

According to analysts, Tata Tea is not representative of this plantation industry in the south. It has resources to fall back upon derived from its operation in Assam, where it grows nearly 21 million kg.

The same, however, cannot be said about the company’s tea manufacture in Dooars, the centre too having fallen on bad times.

The surplus, albeit falling, has enabled Tata Tea to lift the quality of its south Indian teas "close to the top from below average to average" through the employment of best agronomic practices. Equally importantly, the company has developed systems to "continuously track customer satisfaction." At this point, Mr. Siganporia can rightly claim that Tata Tea has succeeded in "locating different customer groups for a substantial segment of its south Indian production."

Tea growing conditions in south India and Sri Lanka are somewhat identical. But while Sri Lanka continues to make phenomenal progress in exports - its sales in the world market grew 2.1 per cent last year to a record 294.5 million kg, including imports for re-export after value addition – the Indian export fall remains unchecked.

In the first half of this year, Indian tea exports were down 2.3 million kg to 74.1 million kg.