A tea delegation from Iran, comprising representatives of trade, industry and government, is set to visit India early next month.

The visit is being considered significant, given the upward trend in India’s exports of orthodox tea to Iran, a high-value market. Iran accounts for about 10 per cent of India’s foreign exchange earnings from tea.

“While India had sent two delegations since July 2012, it last received an Iranian delegation nearly three years ago,” a senior industry official said.

India vies with Sri Lanka for a share of the 140 million kg Iranian tea market. Although there is preference for the Indian teas, payments problem since the U.S. imposed sanctions had become a major hurdle.

In 2012, a delegation led by the then deputy chairman of the Tea Board of India had visited the oil-rich country to discuss ways of smoothening transactions. India-Iran trade now takes place through the rupee payment route.

The Iranian delegation, which comprises importers, is set to visit tea estates in Assam and Darjeeling, which produce most of the quality orthodox teas. Representatives of the Iran Tea Organisation, a body of tea growers, and the Iranian Tea Association, an organisation of importers, would also form part of the delegation.

Sources in the Indian tea industry said that they were keen to hear from the government officials on the delegation the thinking of Iran’s newly-elected government on India-Iran trade, as well as on regulatory issues pertaining to presence of residues in teas.

Iran grows some 50 million kg of tea but has to import to feed its domestic market. India imports around 2.4 million kg of Iranian tea (mainly for sampling). In the wake of the sanctions and the ensuing payments problem, India’s tea exports to Iran dropped to 7 million kg in 2010. With issues sorted out, India exported 13.5 million kg in 2012. Although logistic issues are now proving to be a hurdle for Indian tea exporters (as most shippers decline to sail to Iran), there is optimism that the export figure could double this year.

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