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FAIFA appeals to PM to withdraw COTPA Amendment Bill

Wednesday - January 13, 2021 5:45 pm , Category : BUSINESS
New Delhi, Jan 13 (IANS) The Federation of All India Farmer Associations (FAIFA), a non-profit organisation representing the cause of millions of farmers and farm workers of commercial crops, has appealed to Prime Minister Narendra Modi to recall the COTPA Amendment Bill as it will be a death knell for Indian FCV tobacco farmers.
The proposed Amendment Bill, 2020, will provide huge boost to the ever-growing illicit cigarette business in India and will adversely impact the legal cigarette trade. As a result, there will be a drastic drop of demand for tobacco grown by Indian farmers and they will lose their only source of livelihood, it said.
FAIFA has submitted its appeal to various concerned ministries, including the PMO, Ministry of Health and Family Welfare, Ministry of Agriculture, Ministry of Commerce and Industry, Ministry of Labour etc.
In the last few years, the government has imposed harsh tobacco regulations such as increasing the size of pictorial warnings, imposing punitive taxation on cigarettes with the tax burden more than trebling since 2012-13 and has even withdrawn export benefits.
All these are leading to adverse consequences on the livelihoods of crores of Indians without providing any alternatives livelihood opportunities or help to the farmers who cannot grow any other equally remunerative crop in the dry and arid regions they reside in, FAIFA said.
The farmers' body said that presently, India has become the fourth largest and fastest growing illicit cigarette market in the world with illicit cigarettes representing 1/4th of the cigarette market.
In the last one-and-a-half decade, the illicit cigarette market in India has doubled from a level of 13.5 billion sticks in 2006 to 28 billion sticks in 2019. Illegal cigarettes do not use locally grown tobacco and hence, an increase in illegal trade impacts the livelihoods of the tobacco farmers in the country as demand for domestic tobacco reduces further.
The FCV farming community has lost more than Rs 6,000 crore over the last seven years due to drop in off-take of their produce. The growing illicit cigarette trade is not only affecting the legal cigarette industry and farmer incomes, but is also affecting government revenues.
Moreover, India has a unique pattern of tobacco consumption and cigarettes are the smallest component of tobacco consumption in India, constituting only 9 per cent of tobacco use.
Over the last three decades, the legal cigarettes' share of total tobacco consumption in India has declined from 21 per cent in 1981-82 to 9 per cent in 2019-20. During the same period, the overall tobacco consumption in the country has increased by 46 per cent. The legal market for tobacco being excessively regulated has not in any way reduced the demand for tobacco products but has only caused a shift in consumption from legal to illegal duty evaded cigarettes and tax-evaded cheaper products, FAIFA said.
Demanding withdrawal of the bill, Javare Gowda, President, FAIFA, said, "These harsh amendments that have been proposed will terrorise retailers and traders and they would not want to engage in the sale of legal cigarettes. As a result, criminal syndicates, which have been pushing illegal tobacco, will gain ground and flood the Indian market with illicit cigarettes.
"Such illicit cigarettes may be of bad quality and will certainly not follow any of the regulations in force in India. Even currently, illegal tobacco product packages do not carry the statutory warning. Since these illicit cigarettes do not use domestically grown tobacco produced by Indian farmers, the result would be loss of earnings and livelihoods of millions of tobacco farmers who are dependent on the crop in the country."
Murali Babu, General Secretary, FAIFA, said, "We have noted that in the Amendment Bill, all the provisions of the FCTC are being given effect in full force and in some cases more than as required by FCTC. However, there still has been no talk or action taken regarding the actual problems that the tobacco farmers are going to face due to these proposed stringent laws."
India is the second largest producer of tobacco in the world and a large exporter. Tobacco is cultivated in 13 states in the country, providing livelihood to 4.57 crore people, including lakhs of farmers, labourers, poor rural population and tribals and their families.

--IANS san/arm

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