India’s tea, sugar exports raise sustainability concerns at home | Explained-OxBig News Network

India is one of the world’s largest agricultural product exporters. The Indian agricultural export is valued at $53.1 billion in 2022-2023, up from $8.7 billion in 2004-2005, a six-fold increase in less than two decades. For an economically developing economy like India, exports play a significant role in strengthening the economy by increasing revenue, foreign exchange, and transactional options. But the rapid surge in exports poses multiple challenges to the sustainability of the production, processing, and distribution systems of the respective commodities.

In this context, it’s important to answer two questions regarding the sustainability of an agricultural commodity system.

First, when can an agricultural commodity be considered truly sustainable? The sustainability of such a commodity isn’t just about economic sustainability, which is driven by productivity. Ecological and social factors, aided by good governance, help build a sustainable production system, so the sustainability of an agricultural system depends on three pillars: ecological factors, economic aspects, and social aspects, underpinned by robust policies underlying all of them.

Second, should sustainability considerations only apply to production? No. Since the lifecycle of a commodity extends across pre-sowing, on-farm production, and post-harvest stages, sustainability applies to them all. Tea and sugar, two prominent commodities in India with a large domestic and export-oriented consumption base, offer good examples to illustrate the problems herein.

Tea

India is the world’s fourth-largest tea exporter and second largest producer and makes up 10% of global exports. The latter totalled 188.76 million kg in 2022, with a value of $641.34 million, an increase of 21.47% year on year in volume and 12.43% year on year in value. The total value of Indian tea exports for 2022-2023 was $793.78 million. Domestic consumption constitutes 80% of total production. The top export destinations of Indian tea are the United Arab Emirates, Russia, Iran, the U.S. and the U.K.

There is also growing evidence of stresses being imposed on production systems across the tea value chain. Three major challenges in the tea industry are the management of human-wildlife interactions, burgeoning chemical use, and labour concerns. An estimated 70% of tea plantations are situated at the periphery of forests and host the migratory routes elephants need to move around, resulting in frequent interactions with humans and human property and damage.

Likewise, synthetic pesticides constitute up to 85% of total pesticide use in tea plantations. This degree of reliance on such pesticides increases the chemical residue in the final product. Researchers have already documented an increase in the incidence of DDT, Endosulfan 35 EC, Dicofol 18.5 EC, and Cypermethrin 10 EC in tea. Exposure to these substances can increase the risk of cancer, diabetes, impaired neurodevelopment in children, and neurotoxicity.

Finally, the labour rights and working conditions of the tea estates cannot be undermined. More than half of tea plantation workers are women and they are often underpaid. The working conditions are also hazardous and workers often lack protective gear. Despite regulations under the Plantations Labour Act 1951 (amended in 2010 to strengthen worker safety), safety standards are almost never fully enforced. There is a critical need for better management practices in and around tea estates in India, stricter monitoring of the maximum residue limits for pesticides, and better enforcement of existing labour regulations.

Sugar

India is the world’s second-largest sugar producer, with 34 million metric tonnes of production, about a fifth of the global production. India’s sugar exports grew by 291% from $1,177 million in FY 2013-2014 to $4,600 million in FY 2021-22 and 64.90% in 2021-2022. The country exported sugar to 121 countries, according to the Directorate General of Commercial Intelligence and Statistics. About 50 million farmers depend on sugarcane cultivation in India. An additional half million depend on sugar and allied factories. According to NITI Aayog, the industry has an annual turnover of Rs 1 lakh crore.

But for the exports’ economic value and the industry’s significant rural employment, it also has considerable adverse environmental effects — but in particular water resource management.

Sugarcane is well-known for requiring a lot of water to cultivate. On average, 1 kg of sugar requires between 1,500 and 2,000 kg of water. Sugarcane and paddy occupy around 25% of the gross cropped area in India and consume 60% of the country’s total irrigation water, reducing the availability for other crops and also stressing groundwater resources. In the last six or seven years, the area under sugarcane cultivation has almost doubled in Karnataka and Maharashtra.

Natural ecosystems like grasslands and savannahs in these states have also been converted to plant sugarcane. Along with the ensuing biodiversity loss, this change has increased the pressure on water resources and increased the need for sustainable water use and alternate cropping patterns. In fact, Implementing drip irrigation in these states could lower water consumption by 40-50%.

The social dynamics of sugar industries narrate another story. Media reports have unearthed poor working conditions, including long working hours. Rising temperatures in peninsular India acts as a threat multiplier, increasing the risks to workers’ physical and mental well-being. Workers trapped in vicious debt cycles incur even more stress. Strengthening regulations and encouraging structured and responsible production practices are important to reduce these effects and promote sustainability.

Millets

Even as the sustainability challenges of these commodities persist, there are some others that promote long-term ecological and socio-economic sustainability, and their successes could serve as templates to address the problems plaguing tea and sugar.

One prime example is millets, a sustainable option with which to increase domestic consumption as well as exports. Millets are resilient to harsh conditions and don’t require more inputs to weather resource constraints. They preserve soil health and ensure nutritional security.

The growing importance of millet export is evident in the export statistics. India reached a major milestone in 2021-2022 when it exported millets valued at $62.95 million, up from $26.97 million in 2020-2021, almost a 2.5-fold increase in a single year. In FY 2022-2023, the country shipped 169,049.11 metric tonnes of millets and millet-related products worth $75.45 million. This rising demand highlights their potential as a sustainable agricultural commodity contributing to economic growth and environmental resilience.

Agricultural commodity production in India lives in a unique context: a large domestic consumption base and now a rapidly growing export base. These dynamics may benefit producers and consumers but they could also yield a paradox: whereby increasing dependencies between different actors in the supply chain compromise ecological and social sustainability concerns. There are successful tales of increasing production and trade volumes but concerns also continue regarding the trickling down of some of those economic benefits to producers and farm labourers, and regarding the vitality of India’s natural resources.

There needs to be more focus on addressing environmental issues and safeguarding the health and safety of both workers and consumers to develop an inclusive agrarian economy that benefits both local communities and global markets. 

Dasari Giridhar is a research associate and Manan Bhan is a Fellow in Residence — both at the Ashoka Trust for Research in Ecology and the Environment (ATREE), Bengaluru.