Calcutta, July 2: The Union commerce ministry has decided to squeeze out Rs 10 crore from the budgets of the various commodity boards to fund a price subsidy scheme for small tea growers in South India.Unlike the north, south India's tea industry has a large number of small farmers, who have been affected by the depressed auction prices. The ministry, headed by Murasoli Maran, has decided to make up the price difference when auction levels fall below Rs 55 a kg. The scheme will cover growers with less than 10.12 acres.
In recent times, auction prices have fallen below Rs 45 a kg.
The novel funding route was discussed at a meeting of the Tea Board's development committee, which had to re-allocate funds already granted for different research and development activities.
The small farmers will be reimbursed up to Rs 5 a kg if auction prices of made tea fall below Rs 55 a kg. For green leaf, the compensation will be Rs 1.25 per kg.
The scheme has been in place since May 1 this year, for a period of six months.
The Calcutta-based Tea Board alone will have to shell out Rs 3 crore to fund the subsidy scheme. This money is being diverted from plan funds allotted to development schemes.
The Tea Board, at a meeting on June 28, cleared the diversion of Rs 50 lakh from its own subsidy scheme account and Rs 2.50 crore from the research and development account.
The commerce ministry has told other commodity boards to cough up the rest of the Rs 10 crore fund. Consequently, the boards for spices, rubber, coffee and silk are also reworking their research and development programmes for the interest of tea farmers.
A Spices Board official said most of the other boards are already facing a funds crisis and have not been able to complete their development schemes. The commerce ministry's decision will cripple what is left.
The Tea Board had sanctioned Rs 32 crore for subsidy and R&D schemes during 2000-01. This includes Rs 16 crore which earmarked for promotional and developmental schemes in the north-east, including Sikkim.
However, the ministry has told the Tea Board not to touch the allocations for the north-east to fund the south India scheme.
This has forced the Tea Board to prune the R&D scheme, for which it had earlier sanctioned Rs 10 crore.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.