Gone up in smoke: Cabinet approves Ordinance to ban electronic cigarettes

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Updated: September 19, 2019 6:34:35 AM

According to Sitharaman, while e-cigarettes are marketed as products to help people quit smoking, they are really not so less harmful as touted to be, and have been blamed for directly causing at least seven deaths in the US.

smoke, Ordinance, electronic cigarette, electronic cigarette ban, e cigarette ban, industry news, BSE, Godfrey Phillips India, VST Industries, Golden Tobacco, ITC, nirmala sitharamanThe government is also concerned that given strong marketing of vaping as a cool and less-carcinogenic solution to traditional smoking, it can potentially lure vast number of non-smokers.

The cabinet on Wednesday cleared an Ordinance to bar the manufacturing and sale of e-cigarettes to effectively ban vaping in the country, leading to a surge in the shares of traditional cigarette makers like ITC and Godfrey Phillips India on the BSE. Briefing the media, finance minister Nirmala Sitharaman said the Prohibition of Electronic Cigarettes Ordinance 2019 will make manufacturing, import, export, transport, sale, distribution, storage and advertisements of e-cigarettes a cognisable offence. The government will introduce a Bill in the next session of Parliament to replace the Ordinance and make it a law. The finance minister headed a group of ministers on this issue.

According to Sitharaman, while e-cigarettes are marketed as products to help people quit smoking, they are really not so less harmful as touted to be, and have been blamed for directly causing at least seven deaths in the US. Responding to the news of ban on e-cigarettes, shares of ITC inched up 1.03% on the BSE, Godfrey Phillips India jumped 5.55%, VST Industries 1.66% and Golden Tobacco 3.85%, against a 0.23% rise in the Sensex.

Asked why the government chose to ban e-cigarettes when cigarette smoking wasn’t prohibited, information & broadcasting minister Prakash Javadekar said it was a preventive measure which was “better than cure”. Before the trend of vaping gripped the Indian youth absolutely, it was better to stop the menace early, he stressed.

The government is also concerned that given strong marketing of vaping as a cool and less-carcinogenic solution to traditional smoking, it can potentially lure vast number of non-smokers. However, as FE has pointed out recently, only around a fifth of the tobacco-related disease/death can be attributed to cigarettes, and the rest is due to bidis and gutka. So unless the government takes concrete steps to discourage the consumption of these products, any tobacco control efforts, such as the ban on e-cigarettes, may prove to be mere distractions.

The government has proposed that any violation of the rule is punishable with jail up to one year or fine up to Rs 1 lakh or both for first-time offenders, and jail of up to three years and fine up to Rs 5 lakh for repeat offenders.

E-cigarettes use a heating element to vapourise liquid nicotine, which the user inhales, instead of burning tobacco, which probably cloaks their hazards. According to Sitharaman, more than 400 e-cigarette brands are available in India, with various configurations of nicotine delivery and in over 150 flavours. They are currently not manufactured in India but imported; at times, the end product is assembled here after raw materials are imported.

Once the ordinance is issued, those holding e-cigarette stocks have to declare and deposit stocks with the police. Currently, India’s tobacco control policy is mostly focused on raising taxes on cigarettes to discourage their use. So, 80-85% of tobacco taxes are received from cigarettes — from Rs 7,651 crore in FY06, cigarette taxes rose to Rs 28,489 crore in FY17 — whereas just 8-9% of all tobacco consumption is made via the cigarette route; this was around 21% in 1981-82. According to the Tobacco Institute of India — a body of farmers, manufacturers, exporters, and ancillaries of the cigarettes’ segment of the tobacco industry — cigarette duties are roughly 55 times of those on other tobacco products, like bidis and gutka — Rs 5,478 per kg versus Rs 99 per kg.

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