The share of cigarettes in tobacco consumption is decreasing

Hyderabad, Mar 19 (UNI) The share of legally produced cigarettes in tobacco consumption in India has fallen from 21% in 1981-82 to 8% in 2021-21, despite overall tobacco consumption increasing by 50% over the of the period. Despite a low share (8%) of tobacco consumption, the government collects 80% of tax revenue from legally produced cigarettes, the Tobacco Institute of India (TII) said in a report. Legal cigarettes represent only 8% of the total tobacco consumption in the country, while the remaining 92% of consumption is represented by 29 traditional products such as chewing tobacco, bidi, khaini and cigarettes manufactured and sold illegally. . While the legal cigarette industry and a small portion of bidi belong to the organized sector, the bulk of the tobacco consumed in the country (68%) is largely produced in the unorganized sector which escapes fiscal and regulatory oversight. , according to the report. The illegal cigarette trade, which accounts for 1/4 of the total cigarette market in India, has grown rapidly due to high cigarette taxation and the lure of arbitration. The growing illicit trade in cigarettes results in an annual revenue loss of over Rs 15,000 crore to the treasury and negatively impacts the livelihoods of FCV (Flue-Cured Virginia) tobacco growers. According to the Tobacco Atlas, per capita cigarette consumption in India is among the lowest in the world, at just 89 cigarettes per year. This is far less than 2,043 for China, 1,017 for the United States and even less than 363 for Pakistan, 512 for Nepal and 744 for Bangladesh. India is the world’s second largest producer of tobacco, with an annual production of around 800 million kg and it provides direct and indirect employment to 45.7 million people, of whom around 70% work in the agricultural sector. India earns about Rs 6,500 per year from the export of tobacco and tobacco products, while cigarette tobaccos account for over 70% of India’s leaf tobacco exports by value. Although India produces around 13% of the world’s tobacco, its share of the value of the $11 billion in global tobacco lead exports is only 5%. Indeed, exportable varieties (FCV tobacco) account for less than 30% of Indian leaf tobacco production. If India aligns its production model with global demand, it would significantly increase its share of export earnings, the report adds. UNI KNR MR