TobaccoReporter logo

Tag: Pakistan

  • Pakistan’s Illegal Cigarette Market Surges to 42.4%

    Pakistan’s Illegal Cigarette Market Surges to 42.4%

    The illegal cigarette trade in Pakistan surged to 42.4% of the market, leading to major losses for the national exchequer, according to an ARY News report. The market for illicit cigarettes has grown 171% since 2019, outpacing the 154% increase in taxes and duties on legal cigarettes. The highest shares of illegal consumption were recorded in Lahore, Kasur, Sheikhupura, and Nankana.

    Experts attribute the growth in smuggling and illegal sales to the rising Federal Excise Duty on legal cigarettes, which has pushed consumers toward cheaper, unregulated alternatives.

  • Pakistan Tobacco Board Criticized over Multinational Quota

    Pakistan Tobacco Board Criticized over Multinational Quota

    Leaders of the Ittehad Kashthkaran Khyber Pakhtunkhwa (IKKP) said a multinational tobacco company was instructed by the Pakistan Tobacco Board (PTB) to purchase 1.5 million kg of flue-cured Virginia (FCV) from Swabi growers, guaranteeing a minimum price of Rs743 ($2.60) per kg, according to an article published today by the local e-paper Dawn.

     “An official of a multinational national company said on condition of anonymity that the quota which was given to Philips Morris International (PMI) Pakistan was actually agreed with the Swabi growers under the agreements executed with them as it was purchased by the PMI in Shergar, Mardan district, but the PTB officials bound them to buy the 1.5 million kg tobacco in Swabi,” the article credited to an unnamed correspondent said.

    In the article, IKKP leaders criticized government inaction and PTB policies, urging that remaining tobacco be purchased promptly to prevent financial losses for farmers, who rely heavily on this crop for their yearly income. They said with a large quantity remaining unpurchased, the PTB should also oblige other companies to buy the crop from the farmers on time and give up the policy of declaring the remaining tobacco surplus to be purchased from the farmers at low price.

    “The PTB has not played its due role,” Daud Jan Khan, central vice-chairman of the IKKP, was quoted. “The companies have also left no stone unturned to cause as much financial damage to tobacco growers as they could.”

  • Court Orders the Reopening of 26 Cigarette Factories in Pakistan

    Court Orders the Reopening of 26 Cigarette Factories in Pakistan

    Pakistan’s Peshawar High Court has directed the Federal Board of Revenue (FBR) to de-seal 26 cigarette factories in Khyber Pakhtunkhwa that were shut for failing to install CCTV cameras under a directive that was issued August 18 and enforced August 25. Petitioners, including Universal Tobacco Company, argued the order was discriminatory as multinationals were exempted, despite already complying with tracking-and-tracing regulations. Their lawyer contended the new CCTV requirement was excessive, with factories already under electronic monitoring and tax office supervision.

    A bench led by Justice Wiqar Ahmad and Justice Mohammad Ijaz Khan ruled that no further action be taken against the petitioners until the next hearing on September 11.

  • Pakistani Tobacco Farmers Need Protection Amid Export Boom

    Pakistani Tobacco Farmers Need Protection Amid Export Boom

    Muhammad Ameen, chairman of Pakistan’s Fair Trade in Tobacco (FTT), called on authorities and the Pakistan Tobacco Board (PTB) to intervene and safeguard smallholder farmers, citing delayed payments and illegal underpricing of crops. He said that continued mishandling of the current crop by the local companies will damage the domestic economy and threaten Pakistan’s credibility as a reliable exporter.

    “Tobacco farmers are being pushed to the brink,” Ameen said. “They are being forced to sell their crop at prices Rs. 200 ($0.70) below the legally mandated weighted average, and the payments they are owed are being delayed. If we allow local crops to be spoiled or go unsold, our international buyers will look elsewhere. We risk losing markets just as we’re beginning to gain ground.”

    Ameen warned that non-compliance with PTB purchase quotas threatens the sector’s backbone, despite a 158% surge in tobacco exports in FY 2024–25, from $64.4 million to $166.5 million.

  • Pakistani Tobacco Growers Struggle to Sell Surplus Crop

    Pakistani Tobacco Growers Struggle to Sell Surplus Crop

    Tobacco farmers in Pakistan’s Khyber Pakhtunkhwa’s Swabi district are enduring three to four days in open-air queues to sell flue-cured Virginia tobacco to multinational companies, as a surplus crop creates a buyers’ bottleneck.

    While those with purchase agreements secure better prices, many growers without contracts are left waiting with no guaranteed sale. Officials estimate this year’s production at over 100 million kilograms, 20 million kg above the announced combined demand declared by 80 purchasing companies. Farmers say selling to smaller national buyers often means delayed payments, sometimes for months or years. A parliamentary sub-committee will visit tobacco-growing districts to address the crisis, which follows crop losses from hail and storms.

    Last fiscal year, the federal government collected Rs300 billion ($1.1 billion) in taxes from the sector, mostly from two multinational firms, Pakistan Tobacco Company and Philip Morris International, raising concerns about market imbalance and buyer accountability.

  • Pakistan Enjoys 158% Tobacco Export Increase 

    Pakistan Enjoys 158% Tobacco Export Increase 

    Pakistan’s tobacco exports increased 158.3% in the 2024-25 fiscal year, rising to $166.5 million from the previous year’s $64.5 million, according to the Pakistan Bureau of Statistics (PBS). In terms of quantity, exports surged from 18,282 to 43,520 metric tons over that period.

  • Pakistan’s National Assembly Panel Calls for Reforms to Support Tobacco Growers

    Pakistan’s National Assembly Panel Calls for Reforms to Support Tobacco Growers

    Pakistan’s National Assembly Standing Committee on National Food Security met last week to address challenges facing tobacco growers, urging immediate reforms and greater inclusion of farmers in policymaking. Committee Chairman Syed Tariq Hussain emphasized the need to modernize agriculture and expand tobacco cultivation, citing global advances like drone technology.

    Officials revealed that general sales tax is applied to cigarettes but not raw tobacco, and that Rs949 million ($3.3 million) in research funds remain unused due to a key vacancy at the Pakistan Tobacco Board (PTB). The committee demanded swift appointments to all vacant PTB posts to unblock stalled development projects.

    Lawmakers also criticized the exclusion of tobacco growers from PTB committees overseeing local tax funds, corporate social responsibility programs, and crop development. The committee directed the ministry to ensure growers are included, calling their involvement essential for meaningful reform.

  • Pakistani Officials Restrained from Interfering in Tobacco Processing Unit

    Pakistani Officials Restrained from Interfering in Tobacco Processing Unit

    This weekend, Pakistan’s Peshawar High Court (PHC) stopped government officials from interfering in the work of a tobacco processing unit in Mardan, Khyber Pakhtunkhwa Province, following a petition by business owner Mujeebur Rehman.

    Rehman claimed his legally registered unit, which employs hundreds and supplies raw tobacco for cigarette manufacturing, was facing harassment despite tax compliance. His legal team argued that the deployment of Inland Revenue officers and Rangers, as well as the forced installation of surveillance equipment, violated constitutional rights and disrupted business operations during peak tobacco threshing season.

    The PHC asked government respondents, including the Revenue Department and Federal Board of Revenue, to submit their replies while temporarily halting security personnel deployment at the site.

  • Pakistan Empowers Provincial Officials to Seize Illicit Cigarettes

    Pakistan Empowers Provincial Officials to Seize Illicit Cigarettes

    Pakistan’s Federal Board of Revenue (FBR) authorized provincial officials—including deputy commissioners, assistant commissioners, and excise officers—to raid and seize smuggled or tax-evading cigarettes at retail outlets, warehouses, and in transit. Under the order, provincial officers can now target counterfeit or untaxed cigarettes and their transport vehicles. All seized goods will be handed over to the nearest Regional Tax Office for further legal action.

    Seized cigarettes lacking valid tax stamps, or with fake ones, will be confiscated and destroyed, with seizures reported to the FBR within 48 hours using a newly developed application. The move is aimed at curbing illicit cigarette trade and ensuring compliance with excise regulations across Pakistan.

  • Pakistan Sets Prices to Stabilize Tobacco Crop

    Pakistan Sets Prices to Stabilize Tobacco Crop

    Tobacco growers in Pakistan have welcomed the federal government’s decision to set a Minimum Indicative Price (MIP) for various tobacco types, calling it a crucial step for protecting growers’ incomes. The Economic Coordination Committee approved the MIP, making it mandatory for tobacco companies to buy surplus crop at or above the set prices, in line with tobacco marketing law MLO-487.

    Farmers pointed to rising input costs, with tobacco cultivation costing up to Rs1.9 million ($6,650) per hectare, compared to around Rs300,000 ($1,050) for wheat. “If tobacco prices drop, farmers risk losses in the hundreds of thousands,” said former Pakistan Tobacco Board (PTB) director Muhammad Ayaz.

    MIP rates include:

    • Flue-cured Virginia: Rs545/kg ($1.91) (plains), Rs615.9/kg ($2.16) (sub-mountainous areas)
    • White Patta: Rs262.6/kg ($0.92)
    • Barley: Rs316/kg ($1.11)
    • Dark air-cured: Rs388.9/kg ($1.36)
    • Naswar/snuff/hookah: Rs262.6/kg ($0.92)
    • Sun-cured Virginia: Rs350.2/kg ($1.23)