HEADLINES:  

Tobacco in India continued to increase in value during 2010-2011. Growth in value sales was supported by the ongoing volume growth in cigarettes and smokeless tobacco, which are the two biggest contributors to sales of tobacco in India.

After the implementation of pictorial warnings on all tobacco packaging in India during 2009, there had been a lull in the industry and its sales.

During 2010-2011, the Indian government took the step of issuing a blanket ban on foreign direct investment (FDI) in the country’s tobacco industry.

The responses to this policy among key tobacco industry players have been mixed, particularly among cigarette producers.


Paan shops remained the most important distribution channel for tobacco in India during 2010-2011, particularly cigarettes, smokeless tobacco and, increasingly, cigars and cigarillos. Convenience is the key factor in the dominance of paan shops, which are located on corners in the majority of high streets across India.

But with the presence of modern grocery retailers such as supermarkets/hypermarkets expanding rapidly across India, the volume share of total tobacco distribution accounted for by paan shops is set to fall slightly over the forecast period.

Constant value growth in tobacco in India is projected to be positive during the current fiscal due to anticipated positive growth in both cigarettes and smokeless tobacco, the two major contributors to volume sales of tobacco in India. Furthermore, the increases in excise tax will also contribute to value growth.

  INDIAN tobacco Industry AT A Glance IN 2012 - 2013

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