Tobacco Board Focuses On Sustainability & Growth

TOBACCO BOARD FOCUSES ON SUSTAINABILITY & GROWTH

• The Tobacco Board has been at the forefront of strategic initiatives aimed at promoting the sustainability and growth of India’s tobacco industry.
• These measures include crop planning, production regulation, and export promotion to ensure the industry’s long-term viability.

KEY DEVELOPMENTS

• Strategic Initiatives for Sustainability and Growth:
  • The Tobacco Board, established in 1976 under the Tobacco Board Act, plays a key role in regulating tobacco farming and ensuring fair and remunerative prices for tobacco farmers.
  • The Board works closely with farmers, providing assistance and financial support through banks to ensure high-quality tobacco production that meets the standards of both domestic and international markets.
  • The Board’s extension and developmental activities promote sustainable cultivation practices, ensuring the tobacco industry’s future growth.
• Tobacco Exports Achieve Record Highs:
  • India is the 2nd-largest producer of tobacco in the world, following China, and the 4th-largest producer of Flue-Cured Virginia (FCV) tobacco globally.
  • The tobacco sector continues to be a significant contributor to India’s foreign exchange.
  • In 2023-24, tobacco exports reached a record ₹12,005.89 crore (approximately $1.45 billion), marking an impressive growth of 87% compared to ₹6,408.15 crore in 2019-20.
  • The export volume has also surged from 218.84 million kg in 2019-20 to 315.51 million kg in 2023-24.
• Doubling of Tobacco Farmers’ Income:
  • The income of Flue Cured Virginia (FCV) tobacco farmers has more than doubled in the past five years.
  • From ₹124 per kg in 2019-20, the price paid to FCV tobacco farmers has increased to ₹279.54 per kg in 2023-24.
  • This achievement is a direct result of effective government policies and efficient market mechanisms that have significantly improved the livelihoods of approximately 83,000 farmers.
  • The introduction of an IT-enabled electronic auctioning system by the Tobacco Board has played a crucial role in ensuring better price discovery and securing fair remuneration for farmers.
• Record-Breaking 2023-24 FCV Tobacco Season:
  • Despite facing challenges such as natural calamities, FCV tobacco farmers in Andhra Pradesh recorded a historic production of 215.35 million kg of tobacco in the 2023-24 season.
  • Farmers realized an average price of ₹288.65 per kg, the highest-ever recorded price for FCV tobacco, generating ₹6,313.58 crore in earnings.
  • This represents an increase of ₹62.92 per kg compared to the previous season’s average.
  • The auctions for the 2023-24 crop ran for 178 days, from 29th February to 14th October 2024, with 43,021 farmers participating across 16 auction platforms.
• Supportive Welfare Measures for Farmers:
  • The Tobacco Board has extended various welfare measures to tobacco farmers, including financial assistance in the form of grants and loans during difficult times.
  • In the 2023-24 season, 38,751 registered growers benefitted from a penalty waiver for the sale of 76.84 million kg of excess tobacco, resulting in savings of ₹184 crore for the farmers.
  • The Tobacco Board also contributed ₹92.70 lakh to the Chief Minister’s Relief Fund in Andhra Pradesh to assist victims of recent cyclones, demonstrating its commitment to the welfare of the farmers and communities.
• Focus on Sustainable Practices:
  • The Tobacco Board continues to emphasize sustainable tobacco farming by encouraging the adoption of eco-friendly cultivation practices.
  • This not only enhances the quality of tobacco but also ensures the long-term viability of the industry in a changing environmental landscape.
  • The Board’s efforts also include promoting organic tobacco cultivation and reducing the environmental impact of tobacco farming through better crop management practices.

INDUSTRY IMPACT & FUTURE OUTLOOK

• Economic Contributions:
  • The tobacco industry significantly contributes to India’s economy:
    • Provides income to hundreds of thousands of farmers.
    • Contributes to foreign exchange earnings through exports.
  • Growth in production and exports reflects effective strategies by the Tobacco Board and supportive government policies.
• Farmer Welfare and Income Growth:
  • The income of FCV (Flue-Cured Virginia) tobacco farmers has doubled due to:
    • Targeted support and efficient market systems.
    • Rising prices, leading to better livelihoods for farmers.
  • The sector shows potential for continued income growth for farmers.
• Sustainability in Tobacco Cultivation:
  • The Tobacco Board focuses on sustainable practices:
    • Promotes eco-friendly farming methods.
    • Ensures long-term sustainability amidst growing global environmental concerns.
    • Responds to increasing demand for responsibly produced goods.
• Challenges and Resilience:
  • Natural calamities pose challenges, yet tobacco farmers in Andhra Pradesh have shown:
    • Resilience and adaptability.
    • Record-high production and prices in the 2023-24 season demonstrate the strength of the industry and its support systems.

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