Shares of three cigarette makers rose by 1.98% to 5.63% at 10:26 IST on BSE on reports the government is unlikely to ban sale of loose cigarettes in near-term.
Godfrey Philips India (up 5.63%), ITC (up 4.17%) and VST Industries (up 1.98%), edged higher.
The S&P BSE Sensex was up 77.48 points, or 0.27% at 28,520.19.
According to reports, the Narendra Modi government has shelved the Cigarettes and Other Tobacco Products (Amendment) Bill which had sought to tighten restrictions on cigarette sales due to the adverse impact it would have on tobacco growing farmers of Andhra Pradesh and areca nut growers of Karnataka.
Reports suggested that Parliamentary Affairs Minister M Venkaiah Naidu held a meeting on Wednesday, 3 December 2014, with Health Minister JP Nadda, Chemicals and Fertiliser Minister Ananth Kumar, Minister of State (MoS) for Commerce and Industry Nirmala Sitharaman, MoS for Agriculture Mohanbhai Kundariya and some MPs from Andhra and Karnataka to discuss the issue.
The outcome of the meeting was that the bill would not be introduced till farmers shifted to alternative crops. Since this was unlikely to happen in the near future, the bill had been indefinitely shelved, reports added.
The government appeared inclined to go ahead with the anti-smoking legislation late last month. Health Minister J P Nadda stated in a written reply in the Rajya Sabha on 25 November 2014, that the Ministry of Health & Family Welfare has accepted recommendations of a committee that has suggested prohibition on sale of loose or single stick of cigarettes, increasing the minimum legal age for sale of tobacco products, increasing the fine or penalty amounts for violation of certain provisions of the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003 (COTPA), as well as making such offences cognizable. In this regard, a draft note for Cabinet was circulated for Inter-Ministerial consultation.
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