India's Billion-Dollar Illicit Cigarette War

India faces a substantial challenge with illicit cigarette sales, ranked fourth globally by Euromonitor International. This trade thrives on the price disparity between untaxed contraband and legally taxed cigarettes, which are burdened by high tax rates. Recent estimates indicate seizures of smuggled cigarettes worth ₹600 crore during FY'25 alone, highlighting the escalating scale of this illegal market.

The Directorate of Revenue Intelligence points to the North-Eastern region as the primary epicentre for cigarette smuggling. This area accounts for one-third of total seizures, with porous borders contributing significantly. Other regions like Maharashtra-Goa (20 per cent), Tamil Nadu (13 per cent), and West Bengal (9 per cent) also show notable smuggling activities, indicating a rise in the use of coastal and maritime routes.

Philip Morris India is leveraging its global expertise, including advanced Track and Trace systems deployed in over 140 markets, to address the issue locally. The company is collaborating with over 50 key stakeholders, including government departments, to share market intelligence and implement collaborative frameworks aimed at curbing the inflow of illicit cigarettes and protecting consumers.