India has stepped up efforts to curb nearly 1m tobacco-related deaths a year by issuing new rules to embolden the health warnings on tobacco packets and make the country one of the world’s strictest in terms of tobacco labelling.
But while regulators try to crack down on branded cigarettes and similar products, there is still a vast unregulated market for tobacco in India. And it’s far from clear that slapping warnings on cigarette packs will have much impact on health.
For one thing, many more Indians smoke traditional bidis than branded cigarettes. In addition, a lot of people get their nicotine fix from chewing tobacco and other products often produced in the informal sector.
South Korea, which has one of the highest numbers of smokers per capita among member countries of the Organisation for Economic Co-operation and Development, has declared war on tobacco.
The government laid out its battle plan on September 11, including at 80 per cent increase in prices of tobacco products, a ban on manufacturers and retailers from advertising tobacco products and the introduction of picture warnings on tobacco packs. Under the plan, the average price per pack would go up to Won 4,500 ($4.35) by the start of next year. The current price is Won 2,500, unchanged for about 10 years.
Tough times ahead for Russian smokers and for the international tobacco groups that feed their obnoxious habit: a ban on smoking in government buildings introduced last year was expanded to include all public places at the weekend, as the Kremlin stepped up the war on Russia’s estimated 40m cigarette addicts.
Those splashes of rouge on India’s street corners? The culprit is paan.
Made of the heart-shape betel leaf, paan is chewed across south Asia as a mouth freshener and thought to help digestion. But the less discourteous of chewers carelessly spit the remnants straight back out, a constant gripe for municipal authorities that has led to repeated demands for a ban on the stimulant.
So, in its own little way, chewing gum brand Center Fresh is doing its bit for society as it launches a new paan flavoured gum.
Philip Morris International, the makers of Marlboro, the world’s best-selling cigarette brand, has won the right to take its case against marketing restrictions and graphic health warnings in the South American country to the World Bank’s arbitration tribunal, ICSID.
It started off a possible good idea – at least to those who think a state monopoly is a good idea. The government of Viktor Orban, the new-idea-a-minute Hungarian prime minister, decided around Christmas that tobacco products would be sold only in government-franchised shops. Talk was of “helping create Magyar family businesses” while at the same time restricting the outlets for tobacco products, and thereby making it harder for Hungarian youth to catch the habit.
A recent conference held by the China Medical Board, a US foundation, on China and the Global Burden of Disease identified smoking as the third greatest risk to health in the country, behind dietary risks and high blood pressure but ahead of China’s deadly environmental pollution about which so much has been written.
Asia is one of the last great global bastions of smoking, with China and Indonesia – the first and fourth most populous countries in the world – setting the regional lead. China alone is home to more than a third of the world’s smokers, puffing away at a rate of more than 2tn cigarettes a year.
Around two-thirds of adult men smoke in Indonesia, one of the world’s largest and least regulated tobacco markets. The government in Jakarta has tried to introduce legislation to restrict advertising but the proposals have been watered down after industry lobbying. The FT’s Ben Bland talks to smokers, lobbyists and health campaigners about why smoking is still so popular.
After years of debate, enhanced tobacco controls are finally coming to Indonesia, one of the world’s least regulated and (surprise, surprise) largest tobacco markets.
But analysts reckon big cigarette companies in Indonesia, from local players such as Gudang Garam to the likes of Philip Morris International and British American Tobacco, need not be too worried.
Russia is finally getting tough on tobacco with a new law that will ban smoking in public places by January 1, 2015 and increase taxes on cigarettes by as much as eight times over the same period.
In a video blog released on Tuesday, Prime Minister Dmitry Medvedev said the government would go ahead with the measures despite complaints from foreign tobacco producers, who managed to carve out a niche in Russia at a time when European and US sales were plummeting.
Promoting its recent World Tobacco Asia conference in Jakarta, UK-based organiser Quartz Business Media was unashamed, noting on its website that “Indonesia is a recognized tobacco-friendly market with no smoking bans or other restrictions and regulations in contrast to neighbouring Asean countries.”
With 61m smokers – that’s 67 per cent of all men and 5 per cent of women – and an average 20-pack costing just Rp12,700 ($1.32), Indonesia is the world’s fourth biggest cigarette market, in addition to being one of the least regulated.
When Russians and Turks spend, they also spend on cigarettes. This year’s surge in Russian and Turkish consumer activity has given a welcome boost to Philip Morris International, the US tobacco group.
As the company warned last month, the financial benefits would have been even greater had it not been for the recent turmoil in emerging market currencies. “Currency headwinds” held the company back, turning a 3.4 per cent gain in operating income before currency adjustments into a 2.7 per cent decline. Expect more such announcements from multinationals active in emerging markets.
The big dilemma for smokers is normally over health or habit: whether to give up is the key question rather than which brand of cigarette. But if the Indian government has its way, those who prefer foreign brands like Marlboro and Benson & Hedges may no longer have that choice.
According to the Economic Times, two years after the government banned foreign direct investment in cigarette manufacturing, Delhi is considering curbing imports, though it won’t likely concede to the full ban that the Consortium of Indian Farmers has demanded, for fear of violating WTO obligations.
With all the focus on Asia and Eastern Europe as the prime emerging market battlegrounds for Big Tobacco, it is easy to forget that Latin America is a continent that hasn’t quite kicked its own cigarette habit.
British American Tobacco on Monday offered a reminder of the continent’s money spinning potential, following a deal to acquire Colombia’s second-biggest cigarette maker, Productora Tabacalera de Colombia (Protabaco), for $452m (£277m).