Nepali entrepreneurs have started exporting tea to the northern neighbour after Beijing started easing import procedures for Nepali tea at Nepal’s persistent request.

Exporters say that tea, particularly orthodox and specialty, may find an assured market in China in terms of rates and there could be a bulk consignment going to the north in the coming years.

Traditionally, Nepali tea is exported to India.

Tea is among the more than 8,000 products from Nepal and other least developed countries that enjoy zero tariffs in China.

For the past two years, Chinese buyers have been frequently visiting Nepali tea gardens, particularly in Ilam.

“A few tea exporters have registered with the General Administration of Customs of China, an agency responsible for managing the import and export of goods and services into mainland China, from the current fiscal year starting mid-July,” said Deepak Khanal, director of the National Tea and Coffee Development Board.

“For the past three years, we were trying to export Nepali tea in bulk to China through a government-to-government arrangement. But since the G-2-G process may take time, Nepali tea entrepreneurs have registered themselves at China’s General Administration of Customs to export tea.”

“There was a small volume of export before but exporting tea by registering companies is happening for the first time,” said Khanal. “However, for any Chinese importer, they need to obtain a licence to import Nepali tea.”

The procedure to obtain import licences is strict. For Nepali exporters, registration with China’s General Administration of Customs reduces export hassles.

The Gorkha Tea Estate in Phikkal of Ilam, which has been exporting orthodox tea to Germany since 2009, is registered in China's General Administration of Customs and has formally started selling in the Chinese market, said Khanal. “It’s the beginning. The export volume may rise in the coming years as Nepali tea producers are desperate to diversify their trade.”

For the past few years, the demand to ban or impose an import duty on tea from Nepal has been growing louder in Darjeeling. For years, Indian buyers have been alleging that Nepali tea is substandard and, as a result, offer lower prices. Nepali tea is often stopped at different border points under various pretexts.

Udaya Chapagain, director of Gorkha Tea Estate in Ilam, told the Post in a recent interview that since the topography of Ilam and Darjeeling is similar, Nepali tea closely resembles Darjeeling tea. “This has instilled fears in many Indian tea entrepreneurs of losing their global market share.”

“India has a strategy of limiting Nepali tea on various pretexts. The Nepal government needs to pay attention to this on time.”

According to Chapagain, China has of late been showing interest in Nepali tea. “China is a good market for quality Nepali tea,” he said. “We have exported our tea to China for the first time. Let’s see what the response will be.”

China can be a big market for Nepali tea in the future and help break India’s monopoly, traders hope.

Nepali tea entrepreneurs have been facing frequent hassles while selling leaves to India. Therefore, they are looking for potential buyers other than those in India.

“For the past two years, various Chinese groups have been visiting tea gardens in Ilam and meeting officials of the Ilam Chamber of Commerce and Industry and Ilam municipality, including tea entrepreneurs,” said Khanal. The Chinese are interested in Nepali tea as they like the orthodox tea with a history of 185 years.

According to the Department of Customs, Nepal exported 2,587 kg of green and black tea worth Rs1.86 million to China in the four months until mid-November this fiscal year.

In the same period last fiscal, exports amounted to 4,970 kg worth Rs7.5 million.

According to the General Administration of Customs of China, a manufacturer can apply for GACC registration through a single-window e-system. The applicant should fill in the information, submit the application by paying a charge of $980, and start exporting after approval. The GACC registration is valid for five years.

Nepali tea entrepreneurs have been exporting tea to China through their contacts for one and a half years.

Apart from China, Nepal exported Rs11.50 million worth of green tea to the Czech Republic, Rs53.50 million to Japan, Rs10.28 million to Russia, Rs16.07 to the US, and Rs27.72 million to Germany in the first four months of the current fiscal year.

In the review period, green tea was exported to Australia, Denmark, Canada, France, Taiwan, and the UAE.

Nepali CTC tea, which is grown particularly in the southeastern plains, sold out in India in the first three months of the current fiscal year due to low production in the southern neighbour, tea traders said.

Tea production in India dropped by 22 percent this year. India imported Nepali crush, tear, curl (CTC) tea paying nearly double at IRs165 to IRs185 per kg during the first three months of the current fiscal year. The rate was four-year high.

“Normally, it is difficult to get even IRs100 per kg in the Indian market,” said Khanal.

According to the Trade and Export Promotion Centre, tea exports from Nepal made a sharp jump of 58.5 percent to Rs2.36 billion in the first four months of the current fiscal year compared to the same period last year, due to the rise in value. The country exported 8,138 tonnes of tea during the review period.

The country exported 13,916 tonnes of tea worth Rs3.62 billion in the last fiscal year.

As the demand for Nepali CTC tea has been rising in other countries, the tea board has been making efforts to issue a quality trademark for CTC tea.

The board started the process to issue a quality trademark for the tea in January last fiscal year.

The trademark is expected to maintain quality standards for export, said Khanal. In September 2020, Nepal’s orthodox tea got its own trademark, 157 years after the country started growing it.