Comparison between Tobacco Production in India and World -
September 20th, 2010
World tobacco production
Asia and America, together account for 75% of world's production of tobacco. China, USA and India are the three leading producing nations in the world. Other major tobacco producing countries are Brazil, USSR, Turkey, Italy, Zimbabwe, Indonesia, Bulgaria and Japan.
In the last 30 years, global area under crop has hovered around 4.5m hectares. However, production has risen from 4.5mn ton in 1960's to 7.8mn ton in the 90's.
Major players in world market are USA, Brazil. India has the same advantages as Brazil ie skilled labour, low production cost, good infrastructure in terms of power, technology etc.
Indian Tobacco Production
India is the third largest producer and eighth largest exporter of tobacco in the world. While India's share in the world's area under tobacco crop has risen from 9% to 11% in the last 3 decades, its share in production has inched up from 8% to 9%.
Due to diverse climatic conditions, virtually every type of tobacco is grown in India. Almost 90% of area is accounted for by Nicotine tobacem and 10% by Nicotina Restica. Only one third of the tobacco output in the country is flue cured virginia (FCV) variety, suitable for cigarette manufacturing.
Andhra Pradesh, Gujarat and Karnataka account for the major portion (80%) of raw tobacco production in India. These states produce FCV tobacco, bidi tobacco, natu tobacco, cigar tobacco, cheroot tobacco and snuff tobacco. Other states which manufacture tobacco are Maharashtra, Orissa, Tamil Nadu, West Bengal, UP and Bihar. However, a large part of tobacco produced in India is of poor quality.
FCV tobacco production and is regulated by The Tobacco Board. About 0.75mn growers and curers are engaged in tobacco production. Easy availability of tobacco has helped development of cottage industry for manufacture of chewing tobacco, cigar, cheroot, flux etc. Bidi industry provides employment to 4.4mn rural people, mostly women, and the cigarette industry provides employment to 0.55mn people.
According to a study conducted by NCAER, Indian tobacco industry has the potential to export Rs7.5-10bn of tobacco and contribute Rs60bn to exchequer by way of excise duty by the year 2000.
It is evident from the table that tobacco consumption increased significantly in the 50's and 70's, but stagnated in the 80's.
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