RECOGNISING HARD WORK: Union Minister of State for Commerce Jairam Ramesh greeting some of the awardees at Coffee Export Awards 2004-05 in Bangalore on Sunday. Prema Cariappa, MP, is seen. — Photo: V. Sreenivasa Murthy

BANGALORE: The Coffee Board should devise methods to increase the domestic consumption of coffee. This is primary among the five tasks that need to be carried out to address the problems faced by coffee growers, Union Minister of State for Commerce Jairam Ramesh has said.

Addressing presspersons after presenting the "Flavour of India - The Fine Cup Competition 2005" and Coffee Export awards, Mr. Ramesh said the consumption of coffee in Karnataka, which accounts for 75 per cent of coffee produced in the country, is only five per cent. Coffee has not been popular among people compared with tea. "Outlets such as Café Coffee Day and Barista are drawing people in urban areas, but not many people from rural areas prefer coffee," he said.

Mr. Ramesh urged the stakeholders of the coffee industry to take steps to boost the commodity's domestic consumption, which was alarmingly low at just 20 per cent of the total production. He said that while the domestic consumption of coffee in Brazil tripled during the last five years, it had registered a decline in the country. "Unless we strike an equilibrium between domestic consumption and exports, the industry will continue to be in the red," he added.

Mr. Ramesh said lack of corporatisation of the industry is one of the reasons for the low domestic consumption on the lines of the tea sector. Another setback the industry faced was the low quantum of value-added coffee being exported, over two-thirds of which is green coffee, contrary to other coffee exporting countries. In order to boost the export of value-added coffee, the Centre is allowing 100 per cent Foreign Direct Investment into food processing industry, he said.

Coffee growers, who are affected by price fluctuations in the international market, should go in for alternative crop pattern to sustain the loss suffered from market players. "It would be good if the coffee growers switched over to alternative crops, preferably aromatic and medicinal plants, in at least about five per cent of the coffee growing area," he said.

The Union Government has taken steps, including offering one-time settlement, tax concessions and other benefits to coffee growers. It is not a "sunset industry" and the Government will look into it as a major employment generating sector, he said. The Government will extend all cooperation to revive, sustain and support the industry. In the next two months, the Government will come out with long-term initiatives to revive the industry, Mr. Ramesh said.

He said import of coffee from Sri Lanka and other countries had not adversely affected Indian coffee growers. With the new FDI policy for food processing, the coffee industry could benefit from imports, he added.

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