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Thursday March 28, 2024

NRV tobacco generates heated debate

By Jawwad Rizvi
August 17, 2016

LAHORE: Years long stand-off between tobacco companies and growers on the matter of cultivation of non-recommended varieties has landed in the National Assembly.

In Monday’s session of the National Assembly, four PTI Parliamentarians called the Minister of Commerce’s attention to the Pakistan Tobacco Board (PTB) and registered grievances against the functioning of the board. Leading multinational companies, according to the call, were refusing to buy tobacco crop from growers resulting in heavy losses.

An agronomy expert shared that non-recommended tobacco varieties (NRV’s) are known to have high nicotine and sugar contents that make them a matter of grave concern for both the PTB and the legitimate industry which is bound to operate in line with international quality standards. Regardless, aided and abetted by the burgeoning illicit cigarette industry, growers continue to risk their returns by planting low-quality, substandard tobacco variety.

An official of the PTB disclosed that the issues around tobacco buying had intensified since 2010 when the legitimate industry pushed for international quality standards and began prescribing preferred tobacco varieties that ensured a high quality product with lower nicotine and sugar levels. In response to this move, the PTB conducted significant research on the recommended varieties to assess whether they lived up to the claim.

Chemical analysis of NRVs done by PTB during 2012 crop show that almost all NRVs grown by farmers of various areas of KP have much higher nicotine and sugar levels than those required by industry for various international brands of cigarettes. Recommended varieties on the other hand, not only offered higher yields, but also showed lower nicotine and sugar levels than desired standards according to the PTB’s research.

Model nurseries and model plots at farmer fields were established to research and test various tobacco varieties to ensure that the right levels of ingredients were maintained for consistency.

In addition, the PTB also established two research stations at Mardan, Mansehra, one Tobacco Model Farm at Buner in KP and two sub research stations at Kunjah and Okara (Sahiwal) in Punjab that specialise in tobacco leaf research to verify and ensure that the correct varieties were planted.

Based on PTB’s recommendation, in 2012 the Commerce Ministry directed the tobacco industry to distribute seeds of the improved and refined PVH 2310 category in bulk quantities, which performs high on both yield and quality. Since the distribution, the cultivation area of NRV dropped from 70 percent to 40 percent, according to PTB estimates. It is important to also note that farmers cultivating the preferred varieties have one of the highest yields globally, according to a research by Nielsen.

To curb the cultivation of NRVs, the PTB has taken serious steps such as signing formal agreements amongst farmers, representatives of tobacco farmers, and tobacco companies that no NRV would be cultivated by the farmers, and the tobacco companies were not to be compelled by the board to buy the NRVs in future. Upon such a commitment, NRVs for that specific year, ie 2012 were taken by the tobacco companies. However, growers continue to disregard their commitment.

According to an industry official, an evident reason as to why farmers refuse to cooperate lies in the landscape shift of the tobacco industry. As per latest government estimate, the legitimate tobacco industry has declined, whereas the quantum of tobacco crop production remains more or less the same. This shows that sales to tax-evading cigarette manufacturers have been increasing through the black market, leaving farmers exposed to exploitation in terms of delayed payments, while inflicting tax losses to the national kitty.

Hameed Kahtak, a farmer from Buner, on the issue of NRVs said, “Growers looking to make a quick buck by selling to illicit outfits have relied on NRVs that promise a lot of money initially. But hindered by lack of guidance and support from these pop-up manufacturers, they end up cultivating more and do not get good prices. The last resort then is to pressurise the big companies into buying from them.”

It then becomes critical to take action against duty evading players that are bypassing the stringent controls set by the PTB to unravel efforts made to protect farmer welfare.

As some farmers’ involvement with the illegal industry becomes apparent, it is clearly not for lack of awareness that growers insist on planting NRVs. According to a senior leaf manager, employed with one of the leading tobacco manufacturers in the country, capacity building initiatives such as field days, tobacco workshops, training visit (T&V) programmes, and radio talks are conducted on a regular basis to help up-skill tobacco farmers in KP, and to help create a win-win situation for both the growers and buyers by cultivating the best produce.

Despite the presence of a support system that promises high yield and timely high returns to the farmers as opposed to NRVs, the dead-lock prevails. It is clear as day then that engagement and awareness alone are not enough to bring about a change in cultivation practices until stringent enforcement is initiated on illegal manufacturers that are hurting the supply chain, not just by evading billions in taxes, but also by regressing the standards of Pakistan’s tobacco growing community, he believed.