ANOTHER QUOTA

New Zealand Herald, Volume LXX, Issue 21469, 18 April 1933, Page 8

ANOTHER QUOTA

Quota restrictions which have been so strongly urged in many directions as a remedy against depressed prices have been accepted by several countries concerned in the production of tea. It is announced that a measure will shortly be introduced in the Indian Legislature to impose a quota on the export of tea. This is in accordance with an agreement reached by India, Ceylon and the Dutch East Indies. Negotiations to that end have been in progress for some time. The principal feature of the scheme proposed was that each country should select its best year between 1929 and 1931, and on that basis submit to a cut of 15 per cent in exports. There is to be no accompanying restriction on output, which, in the case of India, may even increase, since for several years past the crop harvested has been well below the productive capacity of the country. An official estimate suggests that the maximum export allowed under the quota will be 68i per cent of the amount that could be produced under normal economic conditions. A speculative calculation has found 149,000,000 pounds as the surplus likely to be left in India as the result of restriction for a year. Indian home consumption is not expected to dispose of more than 60,000,000 pounds at its very best. The industry is likely, therefore, to be left with 90,000,000 pounds in hand to dispose of if possible. It is feared that if an attempt is made to force it on the domestic market and prices fall in consequence, the export price will be affected and the purpose of restriction will be defeated. For all that, there is evident determination to try the scheme. To have induced the Dutch East Indies to accept the principle of a quota is regarded as something of a triumph. The longcontinued attempt to restrict rubber exports failed because the Dutch would not consent to apply the scheme to their eastern possessions. The producers of tea have been more successful in this respect than the rubber growers.