The Indian Tobacco Association has appealed to the Centre to extend benefits under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme to the tobacco sector.
The exports mainly include value-added products such as flue-cured Virginia tobacco and tobacco products. “As there is no level-playing field in the international market, India’s exports of unprocessed tobacco have fallen sharply,” association president Maddi Venkateswara Rao said in a statement recently.
From 236 million kg by volume and valued at ₹4,850 crore in 2013-14, tobacco exports declined to 169 million kg and ₹3,780 crore in 2020-21, the association said. It said this seeking to highlight how India, with a wide range of soils and climatic conditions conductive for tobacco production, is well positioned to become a major player in the global market if it can harness emerging opportunities through price competitiveness. Steep increases in the cost of cultivation, transportation and logistics, however, have adversely impacted the price competitiveness of Indian tobacco.
Factors impacting global competitiveness include subsidies provided to tobacco in Zimbabwe, Tanzania, European Union and the USA; duty free regime in the EU for imports from least developed countries such as Bangladesh, Nepal and Malawi; and prevalence of a tariff rate quota in USA providing access at a concessional import duty rate by countries like Argentina, Brazil and Thailand. In contrast, non-quota imports from countries like India are taxed at an ad-valorem rate of 350%.
Mr.Rao said despite several appeals, tobacco was not included for RoDTEP benefits. Extension of the scheme will boost foreign exchange earning of the government and income generation for farmers.
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