Assam and West Bengal tea bodies urge Centre to scrap mandatory auction rule, cite rising costs

Major tea industry associations from Assam and West Bengal have jointly appealed to Prime Minister Narendra Modi seeking amendments to rules mandating compulsory sale of tea through public auctions, arguing that the requirement is financially burdensome and counterproductive.

In a representation dated April 10, 2026, four organisations — the Assam Bought Leaf Tea Manufacturers Association, North Eastern Tea Association, Bharatiya Cha Parishad and North Bengal Tea Producers’ Welfare Association — flagged concerns over provisions under the Tea (Marketing) Control Orders of 2015 and 2024.

The groups, which together represent a significant share of North India’s tea output, noted that the region accounts for around 83 per cent of India’s total production, with Assam and West Bengal contributing roughly 50 per cent and 30 per cent respectively.

They objected to the rule requiring at least 50 per cent of annual tea production to be sold via public auctions, saying it increases transaction costs and delays sales. According to the letter, auction-related expenses are “approximately ₹10 per kilogram”, amounting to nearly 5 per cent of the average selling price and often exceeding producers’ net margins.

The associations also pointed to a recent move by authorities to enforce the provision more strictly through a February 2026 circular, despite it not being implemented in practice for years. They argued that no expert committee constituted by the Tea Board has recommended mandatory auction sales, even while suggesting improvements to the system.

Concerns were also raised over the continued requirement to route 100 per cent of dust-grade tea through auctions, which, they said, “has failed to achieve its intended objectives” while significantly increasing costs.

Calling the mandate inconsistent with the government’s Ease of Doing Business policy, the associations said producers should have the freedom to choose between auction and private sales based on market conditions. They further argued that compulsory auctioning restricts the freedom to conduct business.

The letter urged the Centre to withdraw or modify the relevant notifications and consider exemptions or relaxations for affected stakeholders.