The tea industry has raised an alarm ahead of its fortnightly payment to workers as it braces for a severe cash crunch after being forced to let go of the first flush production.

The tea gardens were coming back to productivity after three months of closure during winter, typically a period associated with no income and only expense. They usually make up for the loss of revenue from the first flush bounty. However, this bounty will be missing this season.

The industry, which employs 1.2 million workers, estimates a Rs 1,400-crore loss on account of the lockdown and has sought a financial package from the Centre.

“No revenue is being generated. No tea is being sold. We are just coming out of a cold weather and an unproductive three months. Where will the money come from?” Atul Asthana, managing director of Goodricke Group India, said. The company is part of Camelia PLC of the UK, the world’s largest private bulk tea producer.

The Indian Tea Association estimates a loss of 100 million kg of production in the lockdown period, putting a further strain on the weak balance sheets of most of the tea producers.

“Barring a handful of owners, everybody else will find it very difficult to arrange money for the payout, leave alone the difficulty of distributing cash directly to the workers,” a tea industry official said.

A garden owner ruled out fresh borrowing to pay wages. “I must have a plan to return the money. Anyway, there is wafer thin margin in tea. I do not want to be caught in a debt trap,” he said.

There are 6.57 lakh workers in the organised sector and 2.65 lakh in Bengal, who earn Rs 167 and Rs 176 a day, respectively.

Vivek Goenka, chairman of the Consultative Committee of Plantation Associations (CCPA) and of the Indian Tea Association, wrote to Union commerce and industry minister Piyush Goyal to provide Rs 1,000 per week to tea garden workers for three months. This would cost the government Rs 1,100 crore.

Tea garden workers are not part of the below poverty line population, potentially leaving them out of the Rs 1.7-lakh-crore financial assistance package announced by the Centre to mitigate the economic fallout of Covid-19.

Many garden owners also fear that law and order may deteriorate if workers are not paid in time. “At best there will be part payment to maintain peace. Else we are lock out and many more sick companies,” said an owner, who has garden both in Bengal and Assam.