As the US’s stiff 50 per cent tariffs on imports from India has taken effect, the Indian tea industry on Monday expressed its concern about the high duty and said it is likely to impact Indian tea exports to the United States.
The US is a significant market for Indian tea. Last year, India’s tea export to the US stood at around 17 million kgs. This year till May 2025 Indian export to the US was at 6.26 million kgs.
“The recent imposition of a 50 per cent tariff on Indian goods is likely to impact Indian tea exports to the US. Any increase in cost cannot be absorbed by the supply chain, given that the producers are already operating on very thin margins,” Indian Tea Association (ITA) said in a statement.
ITA said in the black tea segment, the primary suppliers to the United States are India, Sri Lanka, Argentina and Malawai.
The additional 25 per cent tariff by the US on Indian products for the country’s purchases of Russian oil came into effect on August 27, bringing the total amount of levy imposed on New Delhi to 50 per cent.
“Given the strong demand for Assam and Darjeeling tea variants in the US market, consumers may be willing to absorb a higher price point,” ITA said.
The association said the Indian tea industry needs government-backed policy interventions to establish incentive schemes for ICD shipments, aiming to reduce the country’s high inland transportation costs.
“In order to cater to the growing global demand for orthodox teas and correct the imbalances in the product mix it is imperative that the Government reinstates the orthodox tea subsidy with a higher outlay,” ITA said.
India’s tea export scenario presents a mixed picture, with North India witnessing a significant growth of 8.74 per cent in quantity and 22.33 per cent in value from January to May 2025, compared to the same period in 2024. Consequently, the unit price for North Indian tea exports rose by 12.50 per cent to ₹.308.22.
In contrast, South India experienced a decline of 15.42 per cent in quantity, although the value increased by 2.59 per cent due to a 21.29 per cent rise in unit price to ₹261.37.
“Overall, all-India tea exports increased by 15.09 per cent in value and 16.85 per cent in unit price, despite a marginal decline of 1.51 per cent in quantity,” ITA added.