Social Costs Impact on Tea Production in Assam

Large organized tea estates in Assam face substantial social costs by providing services like free medical care, education, shelter, subsidized food, and provident fund facilities to employees. These expenses elevate their green tea leaf production cost to Rs. 25/kg, according to Mr. Bidyananda Barkatoky, President of the Assam Branch of the Indian Tea Association (ABITA).

In contrast, small tea growers do not incur these social costs, resulting in a significantly lower green tea leaf production cost. A survey of 564 small tea growers in two sub-divisions revealed that only about 30 provide free lodging, and none offer medical, educational, or provident fund facilities. Furthermore, small tea holdings often do not adhere to the minimum wage rates stipulated by the plantation labor Act.

The absence of these social costs presents significant opportunities for the healthy development and growth of small tea growers, particularly in the Udalguri district, allowing them to remain competitive due to lower operational expenses.