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New Delhi is pressing Dhaka to reduce duty on the import of tea from India into Bangladesh with an eye to reaping the benefits of such shipments.
The Indian High Commission in Dhaka has requested foreign ministry to take steps to this effect, according to sources.
The call for a reduction in duty comes as the current quit high rate, as Delhi thinks, is adversely affecting the economy of tea producers, particularly in Tripura.
Earlier, Dhaka imposed a 90-per cent duty on the import of tea from Tripura state to Bangladesh.
The embassy has requested to take issue with the authorities concerned to decrease the existing duty.
An official source said the tea producers of Tripura want a 30-35 per cent reduction in import duty, which will ultimately benefit them.
Tripura grows an estimated 0.9-1.0 million kilogram of tea annually, making up 10 per cent of India's total tea production.
Tripura is the fifth state in terms of highest tea production.
As per the commerce ministry, the government has set a target to increase tea production to 140-million kg by 2025, aiming to meet the mounting local demand and expand exports.
In 2020, Bangladesh produced nearly 86.39-million kg of tea. The production increased to more than 96.50 million kg in 2021.
However, tea production dropped to 93.829-million kg in 2022, according to the Bangladesh Tea Board (BTB). The volume of exports in 2022 was 0.78-million tonnes.
The domestic demand for tea is rising due to rapid urbanisation, a change in consumer taste along with faster population growth.
According to a Bangladesh Bank review, market diversification is necessary to boost production of tea and its contribution to national export earnings.
In January-March 2019, the primary importers of tea from Bangladesh were the United Arab Emirates, Pakistan, the USA, Saudi Arabia, Kuwait, Bahrain, Japan and China.
Once a tea exporter, Bangladesh has recently turned into an importer of the popular commodity.
It imported tea to the tune of 8.1-million kg in the 2021 calendar year, according to available data.
When contacted, a desk official of commerce ministry said, "We received a letter from the Indian High Commission in Dhaka."