India's tobacco industry is losing Rs.350 crore every day as cigarette makers have shut their factories due to lack of clarity over the proposed health warnings on packets, industry lobby Assocham said on Tuesday.
"Livelihood of more than 45 million people engaged in the tobacco industry across India is being threatened due to this ambiguity on policy related to graphic health warnings on tobacco products," Assocham told the central government.
It said closed operations of cigarette makers have opened the floodgates for illegal imports to the extent of 90 percent and has led to exponential growth in sales of duty-evaded illegal cigarettes without pictorial health warnings.
The legal cigarette industry accounts for just 11 percent of tobacco consumption across India due to high taxation.
The industry organisation said the acute financial distress faced by farmers engaged in tobacco farming has led to an increase in farmer suicides in major tobacco growing states like Andhra Pradesh, Karnataka and Telangana.
Assocham said the government exchequer was being denied one-fifth of the total tobacco industry revenue -- over Rs.9,000 crore -- which has in turn led to a sharp rise in seizure of contraband cigarettes, thereby converting India into a major global hub for smuggled cigarettes.
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The union health ministry notified that tobacco products are required to have pictorial warning on 85 percent of packaging space.
Assocham said the global average size of pictorial warnings on tobacco products was about 31 percent of packaging space.