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India’s Tea Party

Was the takeover of Britain’s Tetley by the Tata Group a reversal of colonialism?

March 21, 2000

Was the takeover of Britain's Tetley by the Tata Group a reversal of colonialism?

Tea, of course, was critical in helping the East India Company — the famous trading company founded in London in 1600 — develop into one of the strongest economic forces of its day.

Yet, the company was not meant to act only as an economic force.

It was intended to lay the foundation for the mighty British Empire, by annexing major parts of South Asia. It was a de facto empire in itself until 1858 when the British Crown took over governing India officially.

Tata, as well, is one of India's major success stories. Founded in 1868, it developed into a conglomerate with interests in a variety of industrial sectors.

By the 1930s, Tata was the empire's biggest steel producer — even larger than the mills in its mother country, Great Britain.

In view of this impressive record, it seems that with the acquisition of Tetley, Tata has finally made the empire strike back. Yet, the acquisition of Tetley is not only an example of India’s growing economic strength.

Tata has become a powerful symbol of India’s growing economic independence as well, by acquiring a British company that deals in tea — arguably the most English of all drinks.

It merely adds insult to Britain’s injury that this reversal of imperialism occurred on the 400th anniversary of the East India Company’s founding.

A curious by-product of the acquisition is that Tata automatically gains a sizable share — 24% — of the U.S. tea bag market. Now that Indians can sell their tea directly to Americans (without going through British intermediaries), India has truly discarded one of the vestiges of an old colonial economic system.

Back in the 1770s, tea played a crucial economic and political role in the British empire. During the famous “Boston Tea Party,” numerous settlers, disguised as native Americans, threw crates of embargoed tea into the Boston harbor.

This action was part of a general boycott of tea imported from Great Britain. The colonists were protesting British tax policies. In Boston, this particular tea had been a cargo on a ship owned by — you guessed it — the East India Company.

Little wonder then that Tata takes considerable pride in the fact that — via its acquisition — Tetley is now functioning as a direct link between Great Britain’s former colonies in India and America.

Or, as Tata’s vice chairman put it, the deal represents an important first step in bridging the “historic gap between producing countries and consuming countries.”

In the heyday of British colonialism, the East India Company’s dominance in the tea trade made tea seem less an Asian product and more a British one.

But now, India has managed to reclaim its agricultural heritage. Granted, the subcontinent gained its political independence back in 1947 through the efforts of Gandhi, Nehru and Jinnah.

And in this vein, to ensure complete economic emancipation, India is going to need more firms like Tata.