Although India’s cigarette industry has recorded healthy growth in recent years, the government’s taxation policy and increasing restrictions on smoking in public places has hurt the growth prospects for it. Cigarettes have been on the receiving end of the present high inflation rates and prices have shot up in recent years. Apart from excessive taxation on the product, the overall official policy is not friendly towards the industry. For instance, foreign direct investment (FDI) is not allowed in this industry, which has restricted entry of many quality foreign players who are otherwise interested in the Indian market. Other products such as ‘gutkha’ and ‘pan masala’ which provide an alternative to smoking also add to the stiff competition that the industry faces, apart from government restrictions on cigarette brand advertisements in public media. Hide this