Darjeeling tea's lessons for handlooms

With a total production of more than 5,000 million metres in the year 2005, India is the world's largest handloom producing country. The most celebrated products include Jamdani, Ikkat, Kota, Banarasi and Patola. The uniqueness of weaving methods prevailing in India lends these products a distinctive quality which has won the patronage and recognition of discerning consumers all over the world for over a century.

To promote handloom products in domestic as well as international market and to reduce the problems faced by handloom weavers in marketing their products, the central government launched the Handloom Mark scheme in June 2006. The idea is that the 'Handloom Mark' will provide a collective identity to the handloom products and can be used not only for popularising the hand-woven products but can also serve as a guarantee for the buyer that the product is genuine.

Though there are a number of handloom co-operative societies, mostly supported by government funds, the handloom production is predominantly in the private sector. The Textile Committee, a statutory body constituted in 1963 by the central government to look into the problems of textile workers, has been concentrating on the powerloom sector. The committte's chairperson is from the textile industry, and the current chairperson is Krishna Gahlawat. The committee is yet to obtain 'home protection' by registering the Handloom Mark logo as a Certification Mark under the Indian Trade and Merchandise Marks Act, 1958. But under the new Geographical Indication of Goods (Registration & Protection) Act, 1999, (which became operational on September 15, 2003), the committee and the government have been filing applications to register handloom products as a geographical indication. Pochampally and Kota products are already registered under this provision.

Still, there is no statutorily compulsory system of certifying the authenticity of the handloom product being exported under any legal provisions. The Handloom Mark system does not require dealers in handloom products to compulsorily enter into a license agreement with the Textile Committee and pay an annual license fee. However, the terms and conditions of the voluntary agreement provide that the licensees would furnish information relating to production, manufacture and sale of handloom products. The Textile Committee would probably compute and compile the total volume of handloom products produced and sold in any given period.

Also, the Handloom Mark logo is yet to be registered either in India or in countries such as the UK, the USA, Canada, Japan, Egypt and some European countries as a trademark or certification trade mark or collective mark.

Darjeeling Tea and the Tea logo

In comparison, Darjeeling tea seems far ahead. Tea cultivation in Darjeeling is done in nearly 17,400 hectares in 85 tea gardens producing around 11.5 million kilograms of tea. The Darjeeling tea industry employs over 52,000 people on a permanent basis - a further 15,000 persons are engaged during the plucking season from March to November. More than 60 percent of this workforce are women.

A major portion of the annual production of Darjeeling tea is exported. In 2000, about 8.5 million kilograms of Darjeeling tea worth $ 30 million was exported.

While the tea industry in India is almost completely in the private sector, it is statutorily controlled by the government since 1933 under various enactments culminating in the Tea Act, 1953. The Tea Board was set up under the same Act. It is vested with the authority to administer all stages of tea; cultivation, processing and sale.

From 2000, over a period of four years, 171 companies dealing with Darjeeling tea have registered with the Tea Board, though the logo itself was registered in 1983. This was possible only after a compulsory registration system was put in place and also because trade in tea is better organised than handlooms. Certificates of Origin are then issued for export consignments. Data is entered from the garden invoices (the first point of movement outside the factory) into a database, and export of each consignment of Darjeeling tea is authenticated by issue of the Certificates of Origin by crosschecking the details. This ensures the supply-chain integrity of Darjeeling tea until consignments leave the shores of India.

Customs authorities have instructed all Customs checkpoints to check for and ensure that Certificates of Origin accompany Darjeeling Tea consignments. Overseas importers are thus ensured of 100% authentic Darjeeling tea in all their consignments. Moreover, the Darjeeling logo and word are registered or applied for registration under the relevant laws available in the country where registration is sought. In addition to the above, the Tea Board has also undertaken efforts to get certification mark/collective mark for "Darjeeling" and/or Darjeeling logo in Australia, Canada, Germany and a number of other countries.

Difficulties in enforcement and certification

It isn't just that the Handloom Mark is yet to be registered under Indian Trade Marks Act, 1999. Though the Textiles Committee has offices all over India, with a staff of 600, all these staff are already assigned specific tasks. Handloom certification is an entirely new area of operation and expertise. In addition, handloom production is huge, diverse and widely spread. Given all this, it remains to be seen how the Textile Committee would perform.

One of the key issues to be faced by the Handloom Mark is the design protection and imitations, in addition to the counterfeit products. Handloom Mark requires worldwide monitoring for conflicting attempted or false certification. A watch agency needs to be appointed. All this entails costs, which have to be allocated either by the Textiles Committee from its funds or the government.

Worldwide, already, all GIs are primarily faced with two kinds of risks, one arising from their generic use to indicate a class of products without any regional nexus and the other from their diluted use as trademarks on similar or dissimilar goods or services. Such enforcement is further compounded by the difficulties arising from the civil law and common law divide among various jurisdictions, the former insisting on formal registration in the country of disputed use and the other insisting on proof of local reputation and goodwill in the country of disputed use.

Similar problems of enforcement are likely to occur within the states of India, as state governments would be reluctant to enforce a national law, if such enforcement contravenes the local interests. For instance, powerloom products (read: interests) produced in Tamilnadu are sold as counterfeit handloom products in Kerala. Similar situations exist between Tamilnadu and Andhra Pradesh, Karnataka and Andhra Pradesh and Uttar Pradesh and Rajasthan.

Enforcement of the Handloom Reservation Act (see sidebar) is completely lax, despite the hue and cry from the handloom sector. Though 11 items ranging from sarees and dhothies to select tapestry/upholstery, jamakkalams and some woollen items are reserved for handlooms in the Act, there has not even been a pretense of implementation. Funds allotted are under-utilised, unspent and diverted by most of state governments. It is not clear why the enforcement of the new Handloom Mark in handloom certification would be an exception to these challenges.

Consumer interests, costs of protection and enforcement

An article on Indiateaportal.com, a website run by the Tea Board, says that in a period of four years, the Tea Board has spent approximately Rs.93 lakhs ($200,000) on legal and registration expenses, costs of hiring an international watch agency and fighting infringements in overseas jurisdictions. This does not account for administrative expenses including salaries for those working with the Tea Board, cost of setting up monitoring mechanisms and developing softwares.

Protection of handloom products as a geographical indication, or trademark, is now the responsibility of the Textile Committee. But the question is whether the Textiles Committee or the government is ready to spend the required resources for worldwide protection and enforcement of the Handloom Mark. Taking the lack of interest at the policy level and the negative approach of the Committee as an indication, this is unlikely to be done. The Textile Committee might consider this a significant drain on their budget.

Because of the bureaucratic procedures, a genuine handloom weaver with no resources to reach a Textile Committee office, would find this a tedious and expensive process. Middlemen might step in. There is the danger of the Handloom Mark becoming a licensing process, adversely affecting the average handloom weaver, which it is supposed to protect.

In addition, the transaction costs for the genuine weaver, investors, cooperative societies, master weavers, wholesale dealers and the government would have to be included in the costs of the handloom products. Consumers have to accept these costs, if they want genuine handloom products. But consumers might also be willing to pay these costs, if they are interested in handloom products and they have trust in the Handloom Mark certification process. With transparent processes, efficient mechanisms and more resources allocated by government, winning the consumers' trust may be possible. Equally, resources have to be invested on creating awareness among the consumers about the Handloom Mark.

While the government has recognised the importance of protection, the need is to move forward from there and commit more financial resources. The aim must be to ensure that handloom products are protected for the benefit of the producers and consumers. (Quest Features & Footage)