Aditya Khaitan in Calcutta on Saturday. A Telegraph picture

Calcutta, July 26: The Union government has set up a committee headed by former commerce secretary S.N. Menon to suggest ways to make farm products, including tea, more competitive in the global market.

The import duty on processed agricultural products, including tea, has been brought down to 100 per cent from 150 per cent following WTO imperatives. Any further cut in import duty will affect the competitiveness of these products in the global market.

“It is necessary for Indian tea to maintain its cost competitiveness. Between January and May of this year, tea prices rose by 61 cents per kg in Kenya and Rs 76 per kg in Sri Lanka. However, in India, prices rose by Rs 8.43 per kg on an average, while our production cost has gone up by Rs 21.45 per kg since 2001-02,” Aditya Khaitan, chairman of the Indian Tea Association (ITA), said.

Khaitan was speaking at the 125th annual general meeting of the ITA here today.

Tea producing nations have also decided to set up a body for better functioning of the industry and to regulate the quality and quantity of tea produced in various countries. An inter-government group under the Food and Agriculture Organisation had arrived at the decision to set up the body, Tea Board chairman Basudeb Banerjee said.