How The Tobacco Industry Wins Friends And Influences Policy

Shyama Charan Gupta is one of the members of the parliamentary committee on subordinate legislation that had recently suggested a delay in the implementation of larger pictorial warnings on tobacco products. He owns the Shyam group of companies that produces the brand, Shyam Beedi, which has an annual turnover of around Rs 250 crores from beedis alone.

While the issue of conflict of interest is now entering public discourse, the tobacco industry has been operating more insidiously for some time now to subvert public health policies.

Information received under the Right to Information (RTI) Act has revealed that the Tobacco Institute of India (TII) sent repeated representations to the Union Ministry of Health and Family Welfare asking it to withdraw the notification mandating large-size pictorial health warnings.

TII has, in the past, resisted tobacco-control proposals, taking public positions against those measures in the media. The Federation of Indian Chambers of Commerce and Industry (FICCI) also sent representations to the health ministry as well as the commerce ministry arguing against the proposed amendments to the national tobacco control law, including the notification with regard to the large-size health warnings.

A similar representation was sent by the Associated Chambers of Commerce and Industry of India.

A closer look at some of these organisations might explain their pro-tobacco stand.

The present and the past directors, Sanjiv Puri, Syed Mahmood Ahmad and Udayan Lall, of the TII, which claims to be “a repository of reliable information on the industry and is privileged to be consulted by government, parliamentary committees for information and policy recommendations on tobacco issues” are employed by the ITC.

In the past, Anup Singh held directorship on the board of TII as well as tobacco companies including ITC, Asia Tobacco Company, and Surya Nepal Ltd, at the same time. Similarly, Sai Sankar and Raymond Noronha, who have been directors of TII, were simultaneously on board of the VST Industries, the third-largest cigarette manufacturer in India.

Tobacco industry representatives also hold prominent positions at FICCI.  K K Modi, the Chairman of Modi Enterprises, which includes Godfrey Phillips, the second-largest cigarette manufacturer, is a current member of the FICCI steering committee and has served as the past president of FICCI.

Similarly, K K Modi, Samir Modi (Managing Director at Modi Enterprises), Sarthak Beharia (Group President of the Godfrey Phillips) and Deveshwar (Chairman of ITC) are all members of the FICCI executive committee.

FICCI has, in fact, given a corporate social responsibility award to ITC.

According to the World Health Organisation as well as Framework Convention on Tobacco Control, a United Nations treaty on tobacco control, which India ratified in 2004, there is an inherent contradiction in the tobacco industry doing CSR as the core functions of the industry are in conflict with goals of public health policies with regards to tobacco control.

In this context, it is ironical that the Confederation of Indian Industry (CII) in partnership with ITC formed a Centre of Excellence for Sustainable Development with an aim to help companies achieve social and environmental objectives along with economic ones. Chairman of advisory council Deveshwar of the center is the current chairman of ITC, who has also been a past president of CII.

Globally, it is a known tactic of tobacco companies to work through other groups. In fact, last month, the 12th annual Asia Pacific Tax Forum was held in Delhi (May 5 and 7) to discuss tax reforms in the region. Higher taxes on tobacco is a known effective strategy for tobacco control. However, the forum was co-organised by the International Tax and Investment Centre (ITIC). The website of ITIC mentions major tobacco transnationals among its sponsors, like Philip Morris International, British American Tobacco, Imperial Tobacco Limited and so on.

Its board of directors also include representatives of big tobacco companies. It has, in the past, held conferences to influence policy makers and subvert policies in the interest of tobacco industry. For example, on October 12, 2014, the morning before the sixth conference of the parties of the Framework Convention on Tobacco Control in Russia, ITIC hosted an exclusive event in Moscow for representatives of the Ministries of Finance in an attempt to derail the adoption of Article 6 tax guidelines. In a rare gesture, the secretariat of the UN treaty sent a note to all parties, including India, highlighting the link between ITIC and the tobacco industry.

In her opening address to the Conference of the Parties, Margaret Chan, Director-General of the World Health Organization, denounced ITIC’s effort to undermine the adoption of “robust, expert-driven proposed guidelines on tobacco tax and price policy”. 

While, in a positive gesture, the World Bank decided to reject ITIC’s request for technical and financial support to the forum, some of the top-level government officers from finance participated in this forum. Interestingly, the manual brought out by ITIC (ASEAN Excise Tax Reform: A Resource Manual) clearly propagates tax measures with regard to tobacco that are of interest to the tobacco industry, like phasing out ear-marked taxes on tobacco.

Globally, over 30 countries have taken domestic measures to protect their policies from vested interests of tobacco industry, ranging from limiting interactions with tobacco industry and making them transparent to divesting from tobacco industry and tobacco cultivation. In our region, the Philippines has adopted a policy that prevents conflict of interests within government officials with regard to tobacco control.

The Karnataka High Court, in 2010-2011 as part of a public interest litigation, had ordered the government to withdraw its participation from a tobacco industry event in Bangalore and to adopt a code of conduct for public officials regulating their interactions with tobacco industry. We are yet to see any concrete measures in this regard.

India is losing one million lives every year from tobacco-related diseases and is duty-bound under the United Nations treaty to safeguard its health policies from tobacco industry interference. It is time the new government’s resolve for “good governance” translates into practice.