Staff Correspondent

Says it is having a debilitating impact on tobacco growers in the country

Confederation has urged MPs to pressure the Centre to arrest the illegal entry of foreign cigarettes Smuggled foreign cigarettes are causing a revenue loss of Rs. 2,000 croresCigarettes should be kept out of VAT to help tobacco growers

MYSORE: The Confederation of Indian Farmers' Association has expressed concern over the debilitating impact the illegal entry of foreign cigarettes was causing on tobacco farmers in the country.

Tobacco Board member and president of Karnataka VFC Tobacco Growers' Association Javare Gowda, who is also the executive committee member of the confederation, told The Hindu that the issue was discussed at a recent meeting held in New Delhi, in which 50 MPs from different parts of the country participated.

The confederation has urged the MPs to pressure the Union Government to take steps to arrest the illegal entry of foreign cigarettes in the country, which was affecting the tobacco growers in the State.

Mr. Gowda said the smuggled foreign cigarettes, which are easily available in the country, is causing a revenue loss of Rs. 2,000 crores to the Centre.

"We urged the Union Government to initiate steps to arrest the entry of illegal foreign cigarettes into the country and also stabilize the central excise on cigarettes at the present level. Cigarettes should be kept out of value added tax (VAT) to help tobacco farmers of the country," he said.

Karnataka is among the leading tobacco growers in the country and Mysore accounts for a lion's share in the State's tobacco production. The Virginia fluke cured variety of tobacco grown in Mysore enjoys international demand. The confederation was represented by its chairman Sanat Mehta and secretary general P. Chengal Reddy. During the meeting, a host of issues, including agricultural credit, crop insurance, seeds, genetically modified research, agricultural research and tax reforms were discussed.

The confederation made out a case for extending agricultural loans at a simple interest rate of six per cent.

The confederation also sought a revision of the RBI guidelines so that the entire portion of interest is waived off in the event of crop loss and the principal amount is rescheduled while providing fresh loan.

Expressing dissatisfaction with the existing crop insurance scheme, the confederation said the scheme is not giving the desired results. Hence, the confederation said the scheme should be reoriented and the premium be brought down to one to three per cent with part of the premium amount paid by the Union and State governments.

With public institutions supplying barely 15 to 20 per cent of total seed requirement of farmers, the confederation urged the Government to allocate sufficient funds during the 2006-07 budget for development and supply of quality seeds.

The confederation urged the Union Government to allocate at least Rs. 20,000 crores for the next three to four years in the budget under the Accelerated Irrigation Benefit programme. The confederation also expressed concern over the inadequate funding for agricultural research in India and sought more budgetary allocations.