India: A Tumultuous Year for Tobacco Sector in Prakasam

Source from:  The Hindu 12/29/2015

The year that comes to an end soon saw the well-regulated tobacco sector witness turbulence to a level never been witnessed since the crop holiday was declared in 2000 to correct the demand-supply mismatch.

Tobacco growers in the drought-prone Prakasam district have not seen any crisis since then as the Tobacco Board fixed realistic crop size year after year after assessing the global market condition and the requirement of domestic cigarette manufacturers.

Alarmed by a spate of suicides by tobacco growers, Union Commerce Minister Nirmala Seetharaman visited remote villages in Prakasam to take corrective measures to liquidate the leftover stocks with the ryots in distress by offering a compensation of Rs. 20 per kg, with the Centre chipping in with Rs.15 per kg and the State government accounting for the rest. As a result, 27,950 among 45,923 growers received a compensation of Rs.22.40 crore (Rs.16.80 crore from the Centre and Rs.5.60 crore from the State) for 11.23 million kg of low-grade tobacco they had marketed.

In the last 15 years, Prakasam district has endured several dry spells, consuming the lives of scores of peasants. After a stormy 2015, farmers now hope for a better 2016 as the productions are likely to dip to 70 to 75 million kg in the Ongole region, according Indian Tobacco Association sources. Enditem