The tea is not only traditionally popular among the people living in hot and cold parts of the country but it is considered as integral part of the meal and casual intake. Therefore Pakistan is considered is one of the top countries having high per capita intake of tea.
The drop in prices has been made following the cut in GST from 16 percent to 5 percent by the government in the recent budget.
Unilever’s Lipton was the fastest growing and most profitable tea brand in Pakistan in 2011. Unilever Pakistan broke the record in Unilever (which operates in 90 countries) for the highest number of brand launches in a single year.
Tapal Tea has also reduced Rs 50 to Rs 60 per kg on tea following the impact on the GST cut after budget recently.
Before the budget was announced, tea in Pakistan was 50% more expensive than in India. A major reason was the high rate of sales tax. In India, only a 4% sales tax rate applies. In Sri Lanka it is exempt from sales tax. Rising inflation has pushed many to eat bread dipped in tea as a meal. At a time when the cost of everything is on the rise, the average Pakistani can at least enjoy a cup of tea at much lower rates.
Tea consumptions, imports and productions
With the reduction of the prices, the tea consumption is likely to increase mainly among tea addicted people because it will be more affordable for them from now. The price of tea, which is the staple drink of millions of Pakistanis, is easier in the reach of all segments of society especially those who are at the bottom of the pyramid.
Total tea consumption in the country ranges between 200,000-225,000 tons.
Figures of Pakistan Bureau of Statistics (FBS) revealed tea import of 106,057 tons ($302 million) in July-April 2011-2012 as compared to 102,983 tons ($288 million) in the corresponding period of last fiscal year.
According to the figures of Large Scale Manufacturing, blended tea production in July-March 2011-2012 surged to 57,511 tons as compared to 50,783 tons in the same period of last fiscal year.
Tea is being imported from over 20 countries but the share of Kenya in overall import is over 50 per cent.