GO TO SOURCE
UNITED KINGDOM, August 27, 2001: The once huge domestic market for tea in India is shrinking. Indian tea producers have warned that they are heading for a crisis. With prices of tea at their lowest point for three years --one kilo costs just US$1.37 -- and soft drinks replacing tea as the domestic drink of choice, they say their profits are shrinking. Cheap imports from Indonesia, Kenya, Sri Lanka, Vietnam and China are also threatening domestic production. The president of the Tea Association of India told the BBC that the real trouble stems from increased advertising spending by Coke and Pepsi. Also, it is difficult for India to compete with countries such as Kenya and Sri Lanka, where labor costs are lower. The two soft drink giants are reportedly planning to join forces with the Tea Board and the Commerce Ministry to promote tea.