Photo: Messenger
Bangladesh in recent time has solidified its position as a notable global producer and supplier of tobacco leaf as the export target for tobacco has exceeded expectations by 20.87% within the first six months (H1) of the current fiscal year.
Industry insiders are of the view that there has been a lack of scientific research on the nature, extent and consequences of tobacco cultivation in this country.
Recent developments and government measure suggest that Bangladesh may emerge as an export-oriented tobacco cultivation hub in future.
As reported by the Export Promotion Bureau (EPB), the tobacco industry achieved a noteworthy performance from July to December – thereby generating $108.61 million in revenue. This surpassed the target of $89.86 million. In comparison to the corresponding period of the previous year, the product's earnings were $116.71 million.
A high official of EPB said that the export of tobacco has been gradually increasing over the last four years. The export of tobacco also increased by 28 percent in the last fiscal year. But during six months of the current fiscal year, tobacco export has declined by 6.94 percent year on year.
He mentioned that financial support for tobacco exports at 10 percent has been in place since the beginning of the last year. He expressed optimism that the export of tobacco will witness a substantial increase in the upcoming years.
According to a study conducted by the Bangladesh Institute of Development Studies (BIDS), Bangladesh presently holds the rank of the 14th largest tobacco-producing country globally based on the total cultivated area. In terms of the total quantity of tobacco leaves produced, the country secures the 12th position worldwide, contributing to 1.3 percent of the global tobacco production.
Tobacco leaf production increased from about 40,000 tons in 2000-2009 to about 80-90 thousand tons in 2011-2018 and more than 100 tons in 2019-2022.
Experts said, while tobacco company agents are very actively engaging farmers in tobacco cultivation, giving technical support and loans, the DAE officials are rarely doing the opposite, as they are supposed to.
In 2018, Japan Tobacco International entered the tobacco market of Bangladesh through an astounding US$1.47 billion acquisition deal of the tobacco business of Akij Group, the then second largest tobacco company in Bangladesh.
In the same year, while declaring the national budget for FY 2018-19, the government eliminated 25 percent export duty on tobacco export, which is still in place.
On December 23, 2020, Bangladesh Export Processing Zones Authority (BEPZA) signed an agreement with Asian Tobacco (Pvt.) Ltd to establish a modern cigarettes and tobacco processing plant in Ishwardi Export Processing Zone with an investment of $2.0 million.
Bangladesh exported tobacco and manufactured tobacco substitutes to 47 countries including Belgium, the UAE, Netherlands, Italy, South Africa and the USA.
Messenger/Fameema
