Guwahati: With Assam being identified as a high-potential zone and to reduce India’s reliance on edible oil imports for oil palm cultivation under the Centre’s National Mission on Edible Oils–Oil Palm (NMEO-OP), Patanjali Foods Ltd. is spearheading efforts to transform the region’s plantation economy.
Building on this, Patanjali Foods Ltd., one of India’s largest FMCG and agri-business players, convened a stakeholders’ chaired by Ashok Kumar Singh, Head of Oil Palm Plantations, Northeast, Patanjali Foods, meeting on May 9, 2025 at its Northeast Headquarters in Assam, with over state’s 15 major tea estates and associations to explore the commercial and ecological viability of oil palm as a parallel crop within Assam’s vast tea belt.
In an earlier move, the Assam government has officially declared oil palm a cash crop, unlocking new revenue streams for the state’s tea sector under the Centre’s National Mission on Edible Oils–Oil Palm (NMEO-OP).
“Oil palm cultivation will now be treated as a cash crop in Assam. Tea gardens will be allowed to use 5% of their vacant land for oil palm cultivation under NMEO-OP,” Chief Minister Himanta Biswa Sarma had announced during the cabinet meeting on January 10, 2025, signalling a strategic agro-economic transition in Assam’s plantation sector.
Patanjali Engages 15 Tea Majors to Pioneer Oil Palm Integration:
The meeting, spearheaded by Singh, witnessed participation from over 15 major tea companies, including Goodricke Group, Jay Shree Tea & Industries, Luxmi Group, Roselle Tea, Radheshyam Tea, and other prominent regional players.
Also present were Subhas Bhattacharjee, Advisor – Oil Palm Plantation, and former Principal Advisor to the Industries Department, Government of Assam; Chairman of the North Eastern Tea Association (NETA); and President of the North Eastern Small Tea Growers’ Association (NECSTGA).
“With the global tea market witnessing price volatility and stagnation, oil palm offers a tangible diversification model that can shield the tea industry while creating rural prosperity,” said Ashok Kumar Singh, outlining the strategic purpose of the consultation.
Oil Palm: A High-Value Alternative with Long-Term Gains
Bhattacharjee emphasised that oil palm, backed by NMEO-OP and declared a cash crop by the state, can become a game-changer for Assam’s plantation economy.
“This is a forward-looking diversification strategy. We’re not replacing tea—we’re buffering the risk, stabilising revenue, and future-proofing plantations. Tea is Assam’s heritage, but oil palm could be its economic insurance,” Bhattacharjee told Business North East (BNE).
“The move to introduce oil palm as a complementary crop to tea is not just timely but transformational. In the face of global tea market volatility, oil palm presents an economically viable alternative that can serve as a buffer and catalyst for plantation diversification in Assam,” said Bhattacharjee.
He further noted that the gestation period of 3–4 years for oil palm plants could be offset by NMEO-OP subsidies, and added that Assam’s fertile topography, particularly in regions such as Dibrugarh, Tinsukia, Golaghat, Jorhat, Nagaon, Kamrup Metro, and East Karbi Anglong Autonomous Council, is agro-climatically well-suited for commercial oil palm production.
Oil palm cultivation, which has already proven successful in southern states like Andhra Pradesh and Telangana, is now being aggressively promoted in the Northeast under the NMEO-OP, which offers comprehensive support through capital subsidies, quality planting material, and assured buy-back mechanisms. Patanjali Foods Ltd., one of India’s largest FMCG and agri-business companies, is a key private player anchoring this effort in Assam.
“If we achieve 1–2 lakh hectares of oil palm cultivation over the next few years, Assam can emerge as a national leader,” Bhattacharjee added.
India imports more than 60% of its edible oil demand, making self-reliant edible oil production a national priority. The NMEO-OP, launched in 2021, targets expansion of oil palm cultivation across 10 lakh hectares by 2025–26, with 3.28 lakh hectares earmarked for the Northeast.
The Assam government’s decision to allow tea estates to utilise 5% of their vacant land for oil palm, following the state cabinet meeting on January 10, is a major policy shift unlocking the full incentive structure under NMEO-OP. These include:
• 100% subsidy on planting material
• Assured buy-back mechanism by processors (like Patanjali)
• Financial support for drip irrigation, intercropping, and maintenance
• Establishment of nurseries and training centres
Singh noted that Patanjali has already begun setting up nurseries, deploying technical advisory teams, and identifying pilot blocks for plantation demonstration.
“Our strategy is to build a full ecosystem—nursery to buy-back. We are looking at the tea estates as strategic partners, not just land contributors,” Singh added.
Collaborative Framework: Industry Associations Align
The meeting was not only attended by tea companies but also by key industry associations, reflecting a collective willingness to diversify. The NETA Chairman acknowledged the potential of intercropping and underlined the need for clarity on land usage permissions, while the NECSTGA President raised concerns regarding sapling availability, labour training, and market linkages.
Bhattacharjee responded by assuring that Patanjali, in collaboration with the Agriculture Department, is initiating model plantation zones and will also work closely with ICAR institutes and KVKS to build agronomic capacity and training support for tea garden workers.
“This is about co-creating an alternative economic backbone. Tea is emotionally and economically integral to Assam, but we must think ahead,” Bhattacharjee stressed.
Challenges & Risk Management: What Needs Attention
Despite broad agreement on oil palm’s potential, the meeting highlighted several critical challenges and key areas to be focused:
• Clear guidelines are needed from the Tea Board and state departments on the reclassification of land
• Tea workers will require specific training for oil palm cultivation practices
• Infrastructure for water and nutrient delivery systems must be robust
• Revenue gap during non-yield years (first 3 years) must be addressed
• Availability and utilisation of vacant or underutilised tea garden land
• Subsidy frameworks and viability support under NMEO-OP
• Nursery infrastructure and availability of high-yielding hybrid oil palm varieties
• Training and capacity building of tea estate staff and workers for oil palm practices
• Market assurance and buy-back models offered by Patanjali Foods
Singh assured that the government is exploring a supportive credit model and transition income support for early adopters under NMEO-OP.
“This is a forward-looking initiative. If done right, Assam could emerge as a key oil palm producing state in the next decade,” noted a senior representative from Jay Shree Tea. “The synergy with tea is not only spatial but economic—this is about future-proofing our plantations.”
This meeting marks the beginning of a coordinated effort to diversify Assam’s monoculture-dominated plantation economy, with oil palm being introduced not as a competitor, but as a complementary, revenue-stabilising crop.
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Assam's plantation economy, long reliant on the cyclical fortunes of global tea markets, stands at a potential inflexion point. The introduction of oil palm—traditionally seen as a southern crop—into Assam’s tea heartlands signals a new era of agro-economic diversification.
“This is not a one-season idea. This is about shaping Assam’s agro-industrial future,” Singh remarked.
“It’s time for Assam to reimagine its plantation economy—tea gave us a legacy, oil palm can give us leverage,” Bhattacharjee concluded.
With both policy momentum and industry intent aligning, Assam’s experiment with oil palm could pave the way for a new agro-industrial model for the Northeast, one rooted in climate-smart agriculture, self-reliance in edible oils, and economically empowered rural landscapes.
If the initiative scales successfully, it could generate thousands of new rural jobs, boost farmer incomes, reduce India’s edible oil import bill, and reposition Assam as a key player in the country’s self-reliance (Atmanirbhar Bharat) strategy.
As Subhas Bhattacharjee put it, “This is more than a plantation shift, it’s an economic transformation in the making.”
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