MP Questions Government on investments in tobacco companies; urges end to duality and contradiction in policy
The voice of anti-tobacco citizenry has reached where it matters the most. MP Shri Chandrakant Khaire, has raised the issue of the duality in policy adopted by the government in relation to tobacco and tobacco related products.
Raising the issue, the Lok Sabha MP has questioned the government’s investment in tobacco companies. Mr. Chandrakant Khaire asked the Finance Minister, whether LIC had made investment in a big tobacco manufacturing company and if so, sought details thereof and reasons therefor. He also sought clarity on whether LIC / Govt was aware of cautionary message on tobacco products and the health hazards being faced by the people due to it’s consumption and if so, the details thereof. Mr Khaire further went on to seek details of any compulsion that would have been behind making such investment in cigarette company by LIC.
These questions are a direct result of the recently filed PIL in the High Court of Mumbai by public spirited persons spearheaded by Mrs. Sumitra Hooda Pednekar (wife of Maharashtra’s former home and labour minister, Mr. Satish Pednekar, who died of oral cancer in 2011), Mr. Ashish Deshmukh, Member of Legislative Assembly, Maharashtra including R Venkataramanan, managing trustee of Tata Trusts (In his individual capacity), Dr. Pankaj Chaturvedi , Professor & Surgeon, Tata Memorial Hospital and few others recognising and fearing the menace of tobacco and its effect on the people of this country.
The Minister of State in the Ministry of Finance in reply to the questions raised said with reference to (a) to (c): Life Insurance Corporation of India (LIC) is holding equity shares of ITC Ltd which has diversified presence in various businesses. The Corporation’s investments are carried out within the norms, rules and regulations issued by the Insurance Regulatory and Development Authority of India (IRDAI) from time to time in order to maximise return to the policyholders and minimise risk keeping within the limits prescribed by IRDAI. The investments are done through the secondary market considering the performance and prospects of the individual company and the sector as a whole, with the objective of earning good returns for its policyholders. Government is aware of the health hazards attributable to tobacco usage. The Cigarettes and Other Tobacco Products (Packaging and Labelling) Amendment Rules, 2014, and further notification dated 24th September, 2015 mandates specified health warnings covering 85% of the principal display area of the packages of tobacco products. Tobacco consumption is a major risk factor for some of the Non Communicable Diseases (NCDs) such as cancers, cardiovascular diseases, chronic respiratory diseases etc.
Perplexed by the substantial investments made in the tobacco industry by wholly- owned public sector undertakings and worried about the act of the wholly owned public sector undertakings investing in tobacco companies in contradiction to the anti-tobacco stance taken by the Government of India on a national as well as an international level the PIL had been heard by the High Court. The petition made IRDA (The insurance regulator) and Union of India (throught Ministry of Health and Family Welfare) a respondent to the PIL.
The Mumbai High Court had subsequently asked for more related parties including Ministry of Finance, Ministry of Trade & Commerce, ITC and SEBI to be joined in as respondents.
The PIL is seeking directions against the state-owned insurance companies to divest their shareholding from the tobacco companies and not make such investments in the future. In addition, it also seeks that the Government, as well as the Insurance Regulatory and Development Authority, be directed to frame guidelines/code of conduct to ensure that such disinvestment takes place and such investments are prevented in the future.
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