A recently conducted market survey has identified that majority of the brands of local cigarette manufacturers in Pakistan are still non-compliant with the latest Pictorial Health Warning law. Experts told Business Recorder here on Monday that in a bid to increase the awareness of the risks of cigarette consumption, the Ministry of Health issued SRO 127(KE)/2017 and SRO 128(KE)/2017 which stated that the newly prescribed pictorial health warning shall cover at least 50% of the front side and 50% of the back side of cigarette packets and outers from the 1st day of June 2018. Retailers were given a time of 60 days starting from 1st June 2018 to clear the old stock, after which enforcement in the market would begin.
The manufacturers were, however, mandated to manufacture new pictorial health warning packs from June 1, 2018 onwards.
The survey revealed that majority of the brands of local manufacturers are still selling with the old health warning that carries the old picture and covers 40% of the pack. The penalties of such non-compliance are punishable with imprisonment for a term which may extend to two years or with fine, which may extend to ten thousand rupees or with both.
It has also been noted that Pictorial Health Warning law applies only to cigarettes while gutka, naswar and other tobacco products have totally been ignored. It is very crucial that laws enacted cover all tobacco products, enforcement of which needs to be across the board. However, looking at the current level of weak enforcement by the MoNHSR&C on the new Pictorial Health Warning law, it is safe to assume that adding anything further to the law will also yield the same results.
Over the years, multiple laws have been proposed by the MoNHSR&C and enacted by the Government of Pakistan to ensure that the country's health agenda stays on the right path. However, local manufacturers have made sure that this agenda stays far from being achieved as they are also executing multiple marketing activities that are in violation of the laws set forth by the Ministry of Health. Few examples include giving cash discounts, cash prizes, free cigarettes and multiple gifts including motorcycles, Umrah tickets, mobile phones etc. to consumers, which as per law are banned.
Currently there are 40 plus manufacturers selling more than 200 brands of cigarettes in Pakistan. There are two multinationals while all remaining manufacturers are locally based with their units in Khyber Pakhtunkhwa (KPK) and Azad Jammu & Kashmir (AJK) areas. These local manufacturers operating from KPK and AJ&K areas make up the illicit cigarette sector in the country. The illicit cigarette sector in the country mainly comprises of local tax evaded products and smuggled cigarettes.
The local tax evaded market is about 80% of the total illicit market (20% smuggled cigarettes). Apart from the regulatory violations mentioned, it is also involved in fiscal violations. The minimum price per pack set by the government in the Fiscal Budget 2018-2019 is Rs 48 per pack. The legitimate industry comprising of two multinationals is selling at a price point that is higher than this while the illicit sector is openly selling brands at Rs 15 to Rs 30 per pack.
It is therefore requested to the Ministry of Health to strengthen their enforcement on the current laws. It is imperative to have awareness drives around the country to educate the masses about the prevalent laws as it may help ensuring compliance. Furthermore, along with MoNHSR&C, Federal Board of Revenue (FBR) also needs to tighten their grip around the local manufacturers and bring them in to the tax net as they are causing heavy financial losses to the government exchequer and are also proving to be detrimental for the country's health agenda, they added.