The history of leaf tea in India

After China, India is the world’s second-largest producer of tea. The nation is also a major user of the beverage, making up roughly a fifth of global consumption over the course of history. In 2017, India’s tea exports reached their greatest level in nearly four and a half decades. Due to the high domestic consumption, the country’s exports saw only moderate annual increase. In India, around 80% of all production is used for domestic consumption. Over the past ten years, the nation’s per capita consumption of the beverage has significantly increased. The British East India Company built the first commercial tea plantations in the nation, which facilitated the widespread production of the locally indigenous tea variety that north-eastern Indians typically brewed. When it was first introduced, tea was a luxury beverage. But over the years, rising production and usage made the mixture affordable for everyone to enjoy today. Unsurprisingly, tea was the most expensive beverage on the retail market, and it was predicted to keep growing steadily.

Black tea makes up the largest type of tea market in India. Due to the perceived higher quality of packaged tea, customers are increasingly choosing it over unpackaged kinds. Currently, about 80% of urban Indian households and almost 75% of rural Indian households prefer to purchase its packaged product varieties. The increasing consumption of tea across all socioeconomic strata in India is another factor driving the country’s tea sector. Indian customers are increasingly favouring luxury brands, which is being fuelled by the country’s robust economic growth and the consequent rise in the middle-class population. The tea sector in India is also being helped by the growing demand for the packaged variant of the beverage in both urban and rural areas due to the reduced risk of adulteration, easy storage, and improved quality of these products. Young customers like green tea in its regular and lime/lemon flavours. Brands including HUL, Tata Tea, and Duncans Tea Limited have benefited from the popularity of packaged tea.

The middle class is also more open to experimenting with different tea blends, which is encouraging the creation of niche markets for fruit-flavored, herbal, and other specialty teas. Green tea is expected to witness a robust growth in the coming years as its consumption is witnessing an increase as people become more aware of its health benefits. As more people become aware of the health advantages of green tea, there is projected to be a rise in demand for the packaged variant of the beverage in both categories in the upcoming years. Urbanization and the rising consumption of the beverage without milk in these areas are driving the green tea sector. As a result, India’s tea sector is benefiting from both the country’s rising urbanisation and the increase in disposable income.

In the upcoming years, the business is anticipated to be driven by the rising popularity of cafes and lounges that serve largely different iterations of the beverage. The industry’s expansion will also be aided by the convenience of its distribution channels, which include neighbourhood “kirana” stores and supermarkets as well as the expanding online channel. Because of busier lifestyles and an expanding workforce, the RTD category should experience a healthy uptick as customers look for more practical foods and drinks. In the upcoming years, the business will also be fueled by an increase in packaging and flavour innovation. Another market for the industry’s expansion is the rural sector.

One of the main elements fostering a favourable view for the market is the significant increase in the food and beverage sector. Additionally, the inclination of consumers for premium and packaged tea brands is fueling market expansion. To store and deliver tea, manufacturers use multi-layered packaging to reduce the risk of adulteration and spoiling while preserving the flavour and freshness of the tea leaves. Accordingly, rising consumer awareness of the therapeutic and health benefits of organic and green tea varieties also contributes to the expansion of the market.