FCV crop size has witnessed a sharp drop of 39% from 316 million kg per annum to 194 million kg per annum between 2013-14 to 2021-22 due to high taxes on legal cigarettes.
Federation of All India Farmer Associations (FAIFA), flagged the issue with relates to the consumption price of legal cigarettes in India that has reached the maximum limit to a level where the purchasing capacity of consumers can absorb against the backdrop of cheaper and fast-growing illicit cigarettes and alternatives. It also stated that any further increase in taxes would lead to a severe reduction in flue-cured Virginia (FCV) cultivation and impact the livelihoods of farmers.
The increase has resulted in shrinkage of FCV crop size by a sharp 39 per cent from 316 million kg per annum to 194 million kg per annum between 2013-14 to 2021-22. The FCV cultivation acreage in India has also witnessed a huge drop from 2,21,385 hectares in 2013-14 to 1,22,257 hectares in 2020-21 leading to 35 million man-days of employment loss.
Pointing to the plight of FCV tobacco farmers, Gadde Seshagiri Rao, Ex-Vice Chairman, Tobacco Board & Vice President, FAIFA stated, “The above situation is stressing the farm community as consumers shift to smuggled cigarettes that do not use domestic tobacco. Given that India has a huge and widespread dependence on the tobacco crop for livelihood, the government must act reasonably and responsibly to bring price parity between cigarettes and other forms of tobacco to check the illicit cigarettes market.”
FAIFA also highlighted that the tobacco farmers in the country are suffering due to the actions of vested groups that are advocating high taxes on FCV tobacco under the garb of achieving the government’s tobacco control goals. These groups are bombarding the policymakers with misleading data and flawed research reports that present a skewed picture of the illegal cigarette trade in India to downplay the severity of the illegal cigarette trade in the country.
Javare Gowda, President, FAIFA stated, “It is noteworthy to know that a recently released report by Organized Crime and Corruption Reporting Project (OCCRP) states that one of the largest global cigarettes MNC as part of its market expansion strategy has been using smuggling as one of the distribution channels to increase their market penetration.”
Murali Babu, General Secretary, FAIFA, commented, “ It is high time that the government takes an all-en-compassioning approach to meet its tobacco control goals so that the interests of FCV tobacco farmers are also protected.”
Yashwanth, National Spokesperson, Federation of All India Farmer Associations (FAIFA) stated, “The government needs to embrace an integrated approach to tobacco control in India given tobacco industry’s substantial contribution to the country’s GDP and livelihood dependence on tobacco farming.”
