The biggest challenge in the cigarette industry is high taxation, which has led to a rise in smuggling, with one in every four cigarettes is illicit in India, said Sanjiv Puri, chairman and managing director of ITC.

Puri said India is among the top 5 countries in terms of cigarette smuggling. “Whenever there is a high spread of taxation, the consumption does not get impacted but the legal consumption moves to illegal space. So depending on the balance of the two is what will determine the growth of the industry,” he added.

Puri added that moderate taxations are good because it will make sure that the illegal industry does not get an unusual amount of boost.

“From what we are hearing in the media reports, the government is focused on the 100-day plan and the right areas are being addressed and we are hopeful that in the budget and beyond that they will continue to receive adequate attention.”

“I think it is important for these facets to move into higher growth trajectory so the growth in consumption will follow from that,” he further added.

“Our focus in the past has been in growing our FMCG businesses and that is where the priority remains and aside of that the rest of the portfolio also has a lot of opportunity so we will continue to invest to strengthen our competitiveness and leadership in those segments,” said Puri.

Speaking about restructuring businesses, he said, “We have been restructuring only the lifestyle retailing business. We have not restructured the hotel business. We recently sold John Players and what remains of the business is under restructuring as well. So that’s the piece that we are restructuring and not anything else.”