"The main objective of the meeting is to request the government to make some arrangements with the banks to release the credit that is tied up with Russian buyers to the exporters, to do business with other markets," said an official who did not wish to be identified.

Industry officials said the Russian market which works on extended credit had some $30 million funds outstanding, but the state-owned Daily News quoted the Central Bank governor AS Jayawardena as saying the figure was around $19 million.

Local banks are reluctant to extend credit to exporters fearing they would not receive payments from importers in Russia due to the financial and political crisis there.

"The Russian situation will stabilise. There is no need for panic. Commercial banks have been asked to support exporters toservice other orders as well," Jayawardena told the Daily News.

"We are not asking for a bail out or subsidies, but request the government to take precautionary measures and avert a collapse of the tea market," Michael de Zoysa, president of the Ceylon Tea Traders Association (CTTA) told the newspaper.

"We should address the issue before it's too late. Otherwise the impact will be felt across the entire tea industry," he said.

The inactive presence of Russian buyers at Colombo's tea auction last week pushed the average price down by Rs 8 per kg. However the drop at this week's auction had averaged between Rs 2 to 4 per kg, tea brokers said.

The former Soviet republics purchased 27.636 million kg in the first half of 1998, or 20.7 per cent of the country's total exports, commodity brokers Forbes & Walkers Ltd have said.

The bulk of that tea -- 65 per cent -- went to Russia.

Sri Lanka's tea exports in the first six months of 1998surged by 14.2 million kgs, or 11.89 per cent, to 133.3 million kgagainst the same period last year, Forbes & Walkers have said.

Sri Lanka's tea production in the first seven months of this year was 158.728 million kg, up two per cent from 156.373 million kg in the same period last year. Tea production in 1997 at 276.86 million kg was an all-time record.