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ISLAMABAD: The documented tobacco industry has urged Pakistan Tobacco Board (PTB), relevant law makers and authorities to investigate the matter of surplus tobacco crop in the market, so that farmers do not suffer in the hands of exploiters.

Experts told Business Recorder here on Thursday that the PTB must ensure that there was no political interference and no undue pressure was exerted to target legitimate companies, who contributed more than Rs114 billion to the national exchequer annually, while the remaining over 40 manufacturers accounted for only Rs2 billions contribution.

They said the continuous protests were being held only outside of buying centres of two multinational companies by farmers protesting that their tobacco should be bought while as per the information available with the subscribe, multinational companies were still purchasing the surplus tobacco, while local tobacco manufacturers had either stopped purchasing or were buying in very nominal quantity compared to their quota, which was worrisome.

As per the industry norm, each year tobacco companies conduct an exercise of planning and strategizing their annual demand and presenting the same before the PTB for it to apprise the tobacco growers of the estimated annual requirement of tobacco companies through publishing in national dailies.

As per the PTB, the total requirement for purchase of tobacco crop for the year 2021/2022 was 55.37 million kgs.

The two multinational tobacco companies, the Pakistan Tobacco Company (PTC) and Philip Morris International (PMI) had agreed on a quota of 40 million kgs (72 percent) out of a total of 55 million kgs.

The PTC has a quota of 26.5 million kgs (47.86 percent), while their purchase till date is 35.05 million kgs.

Philip Morris (Pakistan) Limited has a quota of 13.27 million kgs (23.97 percent) and they have purchased almost 14.60 million kgs till date, while all other local tobacco companies and dealers committed to a quota of 15.6 million kgs (28 percent).

The surplus announced by the PTB this year is five million kgs, out of which, the bulk is already being purchased by these multinational companies.

Now, the pressure is unduly increasing on them again in purchasing tobacco crops beyond the surplus purchases even, for the year 2021/2022.

Under the PTB Ordinance 1968, Section 30, the companies/purchasers submit their annual demand to the PTB and are then mandated to purchase that demand as well as any surplus crop produced at a pro rata basis.

This demand is also published by the PTB in the newspapers with the name of companies/purchasers and their committed quantity.

According to the sources, legal and tax compliant multinational tobacco companies are being pressured into purchasing tobacco crop beyond the surplus purchases, for the year 2021/2022.

However, experts believe that a balanced approach should be adopted from office-bearers and they should ask local players to stop exploiting farmers for their personal gains.

A farmer, on a condition of anonymity said that a group of farmers is just playing in the hands of illegal industry players to pressurise the multinational companies, so their burden is shifted on to these two companies.

He further told that certain manufacturers/tobacco dealers are also using their political influence to create an undue hype.

The question arises that if the legitimate companies have purchased more than their committed number, then which companies/purchasers are to be held liable for not being able to fulfil their commitment because of which there is surplus tobacco in the market.

Copyright Business Recorder, 2021

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