ITC buys two-thirds of tobacco from Andhra Pradesh and the remaining one-third from Karnataka for its cigarette manufacturing division, which accounts for over 40 per cent of the group's total revenues.
Earlier this month, the company restarted the cigarette factories after shutting down the manufacturing operations over the government's instructions to increase the size of pictorial warning on cigarette packets. Admitting that the company had lost 15 per cent sales volume due to the recent issues, the ITC chairman maintained that the government didn't have to terrorise the consumer with large pictorial warnings to make him quit smoking as the existing warning signs were sufficient to create awareness among the consumers.
Critical of the ongoing campaign in support of the larger pictorial warnings in India, Deveshwar said that money was coming to the NGOs from the US to kill the local cigarette brands while the consumption of the smuggled cigarette was going up at the cost of the government exchequer.
"Indian brands are going to be impacted here. Indian farmers are going to be affected by this," he said.
Responding to a question he said the company had bought tobacco in AP at the behest of the Union Commerce Minister Nirmala Sitaraman last year owing to the farmers' distress. " But we can not continue the purchases if there was no demand for cigarettes," Deveshwar said.