Indian cigarette makers halt production over health warning rules (updated)

VST Industries

01/04/2016 16:26

* New warning rules policy creates ambiguity, tobacco lobby 
says 
    * India wants warnings on 85 pct of a cigarette pack's 
surface 
    * Activists say industry holding government to ransom 
 
 (Adds comments, context) 
    By Aditya Kalra 
    NEW DELHI, April 1 (Reuters) - Indian cigarette makers 
including ITC Ltd  ITC.NS , part-owned by British American 
Tobacco  BATS.L , suspended production on Friday over what they 
said was ambiguity in the government's new health warning rules 
for packs, a leading industry body said. 
    Rules that mandated 85 percent of a cigarette pack's surface 
to be covered in health warnings, up from 20 percent, kicked in 
from Friday after being delayed for a year.  
    But cigarette makers failed to comply, with packs with 
smaller warnings still being sold in the capital New Delhi. 
    The Tobacco Institute of India (TII) said the industry was 
concerned over potential violation of health warning rules by 
continuing production, adding that the production halt would 
cost the industry $53 million a day. 
    India was last year forced to delay implementation of 
stringent pack warning rules as a parliamentary panel sought 
time to assess how the industry would be impacted.     
    The health ministry later decided to implement the rules 
from April this year, but the panel last month issued a report 
saying the size of warnings should be reduced to 50 percent in 
the interest of the industry and tobacco farmers. 
    Health activists have criticized the panel for favouring the 
industry. The World Health Organization has called the debate on 
reducing the warnings size in India "worrisome".  urn:newsml:reuters.com:*:nL3N16V3YV  
    ITC declined to comment. Godfrey Phillips was not 
immediately available for comment. 
    TII, which has called the new rules drastic and impractical, 
said the industry had written to the health ministry seeking 
clarification. It did not elaborate on what was ambiguous about 
the new rules.  
    A senior health ministry official, who declined to be named, 
said the government was committed to implementing the rules.     
         
    Smoking kills about 1 million people in India each year, BMJ 
Global Health estimates. The Canadian Cancer Society in 2014 
ranked India 136th out of 198 countries that use pack warnings 
to deter smokers, lagging nations such as Thailand. 
    India's $10 billion cigarette market is dominated by ITC Ltd 
and Godfrey Phillips India Ltd  GDFR.NS , a partner of 
U.S.-based Philip Morris International  PM.N . 
    "The industry is holding the government to ransom. There is 
no ambiguity in the rules," said Amit Yadav, director, southeast 
Asia region at Framework Convention Alliance for Tobacco 
Control, a group of more than 350 global organisations. 
 
 (Reporting by Aditya Kalra; Editing by Alexander Smith and 
David Holmes) 
 ((aditya.kalra@thomsonreuters.com; +91-011-49548021; Reuters 
Messaging: aditya.kalra.thomsonreuters.com@reuters.net)(Twitter: 
@adityakalra)) 
 
Keywords: INDIA TOBACCO/