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April 7, 2019

Local cigarette manufacturers ‘burning’ rules, regulations with impunity


April 7, 2019

Islamabad : Local cigarette manufacturers are openly violating the health regulations set forth in Prohibition of Smoking and Protection of Non-Smokers Ordinance, 2002 related to marketing of tobacco products in the country.

There are 40+ local cigarette manufacturers who have shifted their operations to Azad Jammu and Kashmir from Khyber Pakhtunkhwa after unprecedented enforcement action across the country by Federal Bureau of Revenue (FBR) took place in 2017. The total cigarette market in Pakistan is 80 billion sticks out of which these local manufacturers have more than 32% per cent of the market share as of June 2018.

These local manufacturers are openly violating the health regulations set forth SRO 53(KE)/2009 which prohibits any cash rewards on smoking, SRO 655(I)2003, SRO 1086(I)2013 restricting the use of celebrity, sports, human element and animal silhouettes on cigarette packs as well as to advertise the tobacco products. According to health officials, all cigarette manufacturers are bound to follow these regulations otherwise they would not be allowed to sell their brands. On the other hand, these illicit manufacturers openly flout these regulations by offering free gifts; cash back rewards, free sampling, cash offers, use of human or animal pictures to attract consumers etc.

According to the Cigarette (Printing of Warning) Amendment Ordinance 2002, no person shall manufacture packets of cigarettes; or sell or offer for sale cigarettes from packets of cigarettes; or possess or sell or offer for sale packets of cigarettes, on which the mandatory pictorial health warning is not printed as required by Section 3 of the ordinance. In case if someone found involved in such practices should be imprisoned for the two years or fine. However, this is not being practiced as sale of smuggled and non-duty paid cigarettes are continued openly across the country while the authorities concern did not bother to implement the law.

Furthermore, around 87 million illicit cigarettes consumed daily in Pakistan, which are sold below the printed pack price which is tantamount to discounting and hence is in violation of Government of Pakistan’s laws. The discounting allows easy access to youth and hence facilitate youth initiation thus becoming one of the biggest challenges for the health sector. Additionally, these local brands also offering different promotional schemes including giving giveaways prizes, motorcycles, so much so Umrah tickets and what not to encourage smoke their brands which to boost their sales. However, Ministry of Health has never taken serious and effective steps to counter these violations by the local manufacturers. On the other side hike in tax ratio has proved to be counterproductive in achieving the government’s revenue and health objectives due to the presence of these illicit cigarettes which are not only selling at a lower price but also offering multiple incentives to end consumers. This results in attracting the youth to initiate smoking.

According to the Oxford Economics Study, Pakistan is ranked at No. 1 position in illicit trade of cigarettes in Asia, with a total volume of 32.6 billion illicit cigarettes consumed in 2017 mainly due to the existence of illicit trade and non-duty paid manufactures. The closure of one of the manufacturing unit of a multinational tobacco company in Sindh due to which 194 direct employees lost their jobs, besides attached people with the business, is testament to the rising illicit cigarette trade in country.

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