ITC Ltd, India’s largest maker of cigarette, has said that it will resume production at its factories due to a favorable court order, two weeks after it stopped being operational due to stringent rules set by the government.
The government’s order was that from the start of 1st April, all cigarettes have to be covered in 85% health warning, up from 20%. The company chose to shut down its machines saying the order was vague.
The $11bn firm is fighting against the new rules and has even taken the government to court. Estimates in the industry have shown that close to $850 million has already been lost due to the shut down and this has risked the lives of millions of tobacco farmers.
In a statement late on Friday, ITC, part-owned by British American Tobacco, said: “Consequent upon a high court order passed in favor of the company, the company will soon resume manufacture of cigarettes in its factories”.
A spokesman of ITC on Saturday refused to make it clear what was the statement of ITC when it comes to stock exchange.
The company also did not say whether it will start to print bigger health warnings. Earlier this month, it said that it had no plans of printing “excessive health warnings” even after parliamentary panel report asked that warnings size be reduced.
But the panel’s report does not bind the government and officials of the health ministry have insisted that manufacturers have to abide to the new rules.
BMJ Global Health reports that about 1 million people die in India on a yearly basis due to smoking. The World Health Organization says tobacco-related diseases cost the country $16 billion annually.