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Our Bureau

Mumbai, Feb. 26

Contraband trade in cigarettes is becoming an increasing cause of concern for the Government, with an estimated revenue loss of Rs 2,000 crore annually. It also negatively impacts the domestic cigarette industry, affecting a large number of tobacco farmers in Andhra Pradesh and Karnataka. There is a fear that the illegal imports will gradually kill the domestic industry and affect the lives of around five million tobacco farmers.

The Tobacco Research Institute has recommended stricter Government surveillance to help curb the problem. "To dis-incentivise cigarette smuggling, we have recommended lower excise duties-State taxes to reduce arbitrage opportunities," said Mr Udayan Lall, Tobacco Research Institute. Most of the brands are being sold for as little as Re 1 and do not carry the mandatory markings or the retail sales price.

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