Sales of cigarettes declined 8.2 per cent in 2014-15 to 88.1 billion sticks from 95.9 billion the previous year. This is the fourth consecutive year that sales have fallen in India. In 2013-14, cigarette volumes fell by 4.9 per cent, data from research firm Euromonitor shows.
According to the report, the tobacco industry in India is pegged at Rs 66,430 crore in 2015 in terms of retail value sales. The biggest fall in sales was in 2014-15.
| Volume sale of Cigarettes have declined consistently since FY2011 | ||||||
| Change in cigarettes volume sales | 2010-11 | 2011-12 | 2012-13 | 2013-14 | 2014-15 | |
| 4.3% | -0.7% | -1.2% | -4.9% | -8.2% | ||
| Source: Euromonitor International | ||||||
Over the past few years, health issues, stringent norms introduced by the authorities to reduce sales, and the ministry of health and family welfare's continuous efforts at raising awareness by placing ads at various public places have contributed to the fall. The recent move to increase the size of pictorial warning had become a bone of contention between cigarette manufacturers and the government. As a result, the size of such warnings has been increased to cover 85 per cent of the body of the packets from 25 per cent from April 1.
According to industry executives, while sale of cigarettes have taken a toll because of increased awareness of its negative effects on health, contraband cigarettes too have dampened the situation for established firms.
"While the government is coming up with stringent norms for the industry, illegal cigarette makers are cashing in at the expense of law-abiding firms," an executive said on the condition of anonymity.
According to Euromonitor, illicit trade of cigarettes has been on the rise. While in 2014, it formed 19.2 per cent of total sales, in 2015 the share went up to 21.3 per cent. India continues to hold the fourth spot globally in terms of illicit trade of cigarettes.
