An Overview of Nepali Tea’s Industry

Nepali tea is a unique and flavorful beverage made from the leaves of tea plants grown in Nepal. The tea has a distinct appearance, aroma, and taste, similar in many ways to Darjeeling tea, which is perhaps due to the similar geography and topography of the two regions. While Nepali tea is lesser-known than Darjeeling tea due to its relatively smaller production quantities, it is still a high-quality tea that is well worth exploring.

Types of Nepali Tea

Nepali tea falls into two main categories: Orthodox tea and Crush, Tear, Curl (CTC) tea.

Orthodox Tea

Orthodox tea is produced from the Chinese variety of the tea plant (Camellia sinensis var. sinensis) and is typically rolled by hand or machine. This type of tea includes speciality teas like green tea, oolong tea, white tea, and hand-rolled tea, and is produced and processed in the mountainous regions of Nepal at altitudes ranging from 3,000 to 7,000 feet above sea level. Six major districts in the eastern regions of Nepal are known for producing quality orthodox tea, including Ilam, Panchthar, Dhankuta, Terhathum, Sindhulpalchok, and Kaski.

Orthodox tea in Nepal is characterized by four flushes: the First flush, Second flush, Monsoon flush, and Autumn flush. The First flush, which begins in the fourth week of March and continues until the end of April, is the most expensive due to its light and delicate flavor and low production quantity. The Second flush, starting during the second week of May and lasting until the last week of July, is considered the best tea by some experts. The Monsoon flush, also known as “Rainy tea,” begins immediately after the second flush and continues until the end of September. The tea produced during this flush is full-bodied and intense due to the continuous rain. Finally, the Autumn flush begins in October and lasts until the end of November, producing tea with musky flavors, tangy aromas, and an amber liquor.


Crush, Tear, Curl (CTC) tea is processed from the Assam variety of the tea plant (Camellia sinensis var. assamica), which grows in the lower-altitude, hot and humid plains of Nepal, primarily in the Jhapa district. This type of tea accounts for almost 95% of domestic consumption due to its lower production cost compared to orthodox tea.

Nepal’s CTC tea is also characterized by four pronounced flushes, the First, Second, Monsoon, and Autumn flushes. Unlike orthodox tea, CTC tea is more uniform throughout and exhibits a strong color and subtle aroma after infusion. However, the flushes do not begin and end in accordance with those of the orthodox tea due to differences in local conditions.

In conclusion, Nepali tea is a diverse and high-quality beverage worth exploring for its unique characteristics and flavors. Whether you prefer the light and delicate flavors of the First flush or the intense, full-bodied flavors of the Monsoon flush, there is a Nepali tea for everyone to enjoy.


During the Rana Dynasty

During the 1800s and early 1900s, Nepal was ruled by the Rana Dynasty, a highly centralized autocracy that operated as a monarchy. The policies of the Rana Dynasty resulted in the isolation of Nepal from the outside world, causing constant turmoil in terms of borders and governance. While these policies helped Nepal maintain its national independence from British colonial rule, they also hindered modernization and economic development, impacting the nascent Nepali tea industry compared to the thriving Darjeeling tea industry in nearby India, which benefited from British rule.

It is believed that the first tea bushes in Nepal were grown from seeds given as a gift by the Chinese Emperor to Nepal’s Prime Minister at the time, Jung Bahadur Rana. However, Nepal’s tea industry owes its origins to the colonization of India by the East India Company under the British Empire. Around 1863, within a decade of the establishment of the first tea plantation in Darjeeling, hybrid tea bushes were brought to Nepal. The first tea plantation in Nepal, the Ilam Tea Estate, was established in the Ilam district at an altitude of 4,500-5,000 feet above sea level. Recognizing the potential of the tea industry, another tea plantation, Soktim Tea Estate, was established in the same district two years later. In the early 1900s, Nepalese tea producers even acted as suppliers to Darjeeling factories when the tea bushes in Darjeeling became old and yields decreased.

However, despite these initial efforts, Nepal’s tea industry struggled to grow. While the Darjeeling tea industry flourished in the global market, Nepal’s tea industry failed to even meet domestic demand. The setback can be attributed mainly to the political turmoil and economic policies of the period under the Rana Dynasty.

During this time, Nepal faced numerous challenges that hindered the development of the tea industry. The highly centralized autocratic rule, along with policies that isolated Nepal from external influences, resulted in limited access to modernization and economic opportunities. As a result, Nepal’s tea industry remained stagnant while neighboring Darjeeling benefited from British colonial rule and saw significant growth.

After the Rana Dynasty

In the 1950s, Nepal saw a shift in its political scenario, leading to the writing of a new constitution for the development of a democratic system. Although the democratization process was not entirely successful, it opened up Nepal’s economy to the rest of the world. This led to an inflow of public and private investment in the stagnant tea industry, with the first private tea plantation being set up in 1959 in the terai region called Bhudhakaran Tea Estate.

In 1966, the Nepal Tea Development Corporation (NTDC) was established to support the development of the tea industry. Previously, tea leaves produced in Nepal were sold to factories in Darjeeling, as the tea bushes in Darjeeling had become old and the quality of the processed tea was deteriorating. Nepalese tea leaves, therefore, became a valuable input for the factories in and around Darjeeling. Finally, in 1978, the first factory in Nepal for the processing of tea leaves was set up in Ilam, and a few years later, another factory was established in Soktim, Ilam district.

From 1978 to the 1990s, the Nepal Tea Development Corporation and the Overseas Development Administration (ODA) made various efforts to encourage small and marginal farmers to participate in the growth and production of tea as a cash crop. As a result, today small and marginal farmers make up the majority of Nepal’s tea industry. This development led to the transformation of the stagnant tea industry into a fully commercialized industry, benefiting the country’s economic and socio-economic development.

To further support the development of the tea industry, in 1982, His Majesty’s Government of Nepal declared five districts – Jhapa, Ilam, Panchthar, Dhankuta, and Terhathum – as Tea Zones of Nepal. From 1987 to 1993, several institutions, including the National Tea and Coffee Development Board (NTCDB), Nepal Tea Planters’ Association (NTPA), and Himalayan Orthodox Tea Producers’ Association (HOTPA), were established to support the Nepal Tea Development Corporation.

In 1997, the privatization of plantations and factories under the Nepal Tea Development Corporation (NTDC) further transformed Nepal’s tea industry. From the late 1990s to the early 2000s, various international non-governmental organizations became involved with the stakeholders of Nepal’s tea industry. These organizations recognized that the tea industry in Nepal played a significant role in poverty eradication, especially in the rural areas where the tea plantations were concentrated.

By the 21st century, the stagnant tea industry had transformed into a fully commercialized industry. However, it lacked efficiently integrated production and marketing systems, leading to a weak global brand. In 2000, the National Tea Policy was ratified as per the provisions of the National Tea and Coffee Development Board Act of 1992. The National Tea Policy focused on five main topics: production and processing, market and trade promotion, institutional arrangement, manpower development, and development and promotion of auxiliary industries.


Nepal’s tea industry used to be under government control until the 1980s when it was liberalized. Since then, private businesses have dominated the industry, and tea exports have risen exponentially from 100-150 tons per year to 4,000-5,000 tons per year due to the liberalization. Nepal currently produces around 16.29 million kilograms of tea annually across 16,718 hectares, making up only 0.4% of the world’s tea output. The main tea-producing regions in Nepal are Jhapa, Ilam, Panchthar, Dhankuta, Terhathum, and other newly involved areas such as Kaski, Dolakha, Kavre, Sindhupalchok, Bhojpur, Solukhumbu, and Nuwakot. Nepal’s tea is mainly exported to countries such as India, Pakistan, Australia, Germany, France, Poland, the Netherlands, Japan, Belgium, and the United States.

To improve the quality and marketing of Nepalese orthodox tea in the global market, the Himalayan Orthodox Tea Producers Association (HOTPA) has been implementing various measures, including setting up the marketing wing Himalayan Tea Producers Co-operative Limited (HIMCOOP) and implementing the Code of Conduct in 2006 to raise standards to an international level. The Code of Conduct is based on the principles of respecting nature, humans, production systems, and quality. Almost 20,000 farmers in Nepal now benefit from the sustainability provided by orthodox tea, and the National Tea and Coffee Development Board created by the Nepalese Ministry of Agriculture supports them by providing access to credit and land.

Tea Production in Nepal: Growing Regions and Harvest Cycles

Tea cultivation in Nepal is largely concentrated in hilly regions and high altitudes where the climate is conducive for producing high-quality tea. The Eastern mountainous regions of Nepal, situated between 3000 to 7000 feet above sea level, are known for their Orthodox tea crops. The six districts in Nepal where Orthodox tea is produced include Ilam, Dhankuta, Kaski, Terhathum, Sindhupalchok, and Panchthar. Although there are a few medium-to-large scale tea estates, the majority of the tea farmers in these districts are smallholders.

The tea plant can be harvested around four to five times a year once it reaches maturity, producing different harvests called flushes. In Nepal, there are four separate flushes in a growing season: first flush, second flush, monsoon flush, and autumn flush.

Pesticide Use and Organic Farming

While there is no Maximum Residue Limit (MRL) for pesticide use in Nepal, several poisonous chemicals have been banned in the last decade. An Integrated Pest Management (IPM) approach is becoming more popular as an alternative to pesticide application, which includes the use of biofertilizers, vermicompost, and organic farming. However, the lack of internal regulation on pesticide use adversely affects the trade potential of Nepalese tea.

Value-Added Farming and Challenges for Small Farmers

The use of outdated machinery in processing factories and limited access to motorized pruning devices are two of the challenges facing Nepalese tea farmers. The United States Department of International Development has recommended updating machinery to increase productivity. Becoming a certified organic farmer is costly and time-consuming, but it is believed to yield significant increases in profit. However, organic tea production leads to lower yields and increased labor costs, especially during the initial stages of adaptation. Most small farmers in Nepal rely on outside agents to purchase their bulk leaves as they lack the means to add value to their tea through processing and packaging.

Economic effects

From subsistence to cash crop farming

Hillside farmers in Nepal have transitioned from subsistence farming to cash crop farming, specifically orthodox tea. This has provided financial support and involvement in the domestic market. Farmers who specialize in growing tea can sell their crops to purchase staple foods, thereby reducing poverty rates among small holder tea farmers. In fact, 70% of the orthodox tea produced in Nepal in 2006 was by small farms. This crop has proven to be profitable and unique to hillside farmers, and forecasts by the NTCDB predict that by 2022, orthodox tea exports will reach 27 million kg, employing approximately 100,000 people.

Export potential

Engagement in overseas markets will allow Nepali tea producers to capitalize on their product’s high quality and value as a niche product. Currently, Nepali orthodox tea is being sold well below premium to neighboring countries like India. For example, a metric ton of Nepali green tea is valued at $1,180 in India but $12,000 in the USA. Therefore, in order for Nepali farmers and producers of orthodox tea to maximize their profits, there is a need to export to countries like the USA who pay premium prices for the product.

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