The government has no business investing in tobacco, given the tough stance it has taken against it. That is the contention of a group of eminent citizens, who have filed a public interest litigation (PIL) in the Bombay High Court seeking to force State-owned enterprises to offload their stakes in ITC, India’s biggest cigarette maker.

With a 32 per cent stake, held through five public sector insurers and SUUTI (Specified Undertaking of the Unit Trust of India), the government is the biggest shareholder in ITC. Its total stake is worth ₹1.07 lakh crore. This, the petition noted, is bigger than the budgets of some States. It contended that such investments go against the Constitutional mandate vested in the PSUs.

The petitioners, who include R Venkataramanan, Managing Trustee, Tata Trust; Pankaj Chaturvedi, Surgeon, Tata Memorial Hospital; BJP MLA from Maharashtra Ashish Deshmukh and Sumitra Hodda Pednekar (widow of Congress leader Satish Pednekar, who died of oral cancer in 2011), filed the PIL on Thursday against the PSU insurers, insurance regulator IRDAI, and the Ministry of Health and Family Welfare.

The PSU insurers — LIC, New India Assurance Company, General Insurance Company, Oriental Insurance Company and National Insurance Company — together own shares worth ₹76,500 crore. Such investments, the petition states, have enabled tobacco companies to gain “size, scale and clout”.

A big business... Presenting a set of figures for ITC’s financials in 2015-16, the petition stated that cigarettes accounted for 47.83 per cent of the company’s revenue, at ₹18,685.98 crore, that year. They also accounted for 85.31 per cent of its net profit, at ₹12,348.08 crore, it added, noting that FMCG and other businesses such as hospitality made very modest contributions to the company’s topline and bottomline.

The petitioners have urged the court to direct the Centre and IRDAI to frame a law that restrains PSUs from investing in tobacco companies, besides ensuring that the present holdings of the insurers and SUUTI are divested. It stated that the Centre could use the proceeds of a stake sale to bankroll public health initiatives, including offering a health insurance cover of up to ₹1 lakh per family.

And a big killer The petition noted that over 10 lakh Indians die from tobacco-related diseases every year. It noted that tobacco causes 90 per cent of lung and oral cancers and is also responsible for a number of other diseases.

Interestingly, India has ratified the WHO’s anti-tobacco convention, the Framework Convention on Tobacco Control, 2003, which restrains signatories from investing in the tobacco industry so as not to promote the cultivation and production of tobacco.

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