**Policy Summary: Tobacco Processing and Value Addition Infrastructure (August 5, 2025)**
The Department of Agriculture & Farmers Welfare clarifies that it does not implement any schemes promoting tobacco cultivation. The Tobacco Board, under the Ministry of Commerce and Industry, is responsible for regulating the production and marketing of Flue Cured Virginia (FCV) tobacco. The Board plans FCV tobacco crop size in advance, regulates production, and conducts e-auctions to ensure fair prices for farmers and a stable supply for traders. While the Tobacco Board doesn't directly manage farm-to-factory linkages, it focuses on improving marketability to meet international standards, aiming for better prices for FCV tobacco. Measures are also in place to protect farmers from global price volatility.
Since 2020-21, these efforts have led to increased income for FCV tobacco farmers and a doubling of export revenue. The average price for FCV tobacco increased from Rs. 135.24 per kg in 2020-21 to Rs. 279.54 per kg in 2023-24. The value of tobacco and tobacco product exports rose from Rs. 6,496.99 Crore in 2020-21 to Rs. 16,728.02 Crore in 2024-25.
The ICAR-National Institute for Research on Commercial Agriculture (NIRCA), Rajahmundry, conducts research on varietal development, production protection technologies, and leaf quality for various tobacco types across different climatic zones in India. ICAR-NIRCA actively disseminates technologies and good agricultural practices to farmers.
This information was provided by Minister of State for Agriculture and Farmers Welfare Shri Ramnath Thakur in a written reply in Lok Sabha. (Release ID: 2152559)
Key Entities Referenced
Ministry of Agriculture Farmers Welfare: The Indian government ministry responsible for agriculture and farmers' welfare.
Tobacco Board: A statutory body under the Ministry of Commerce and Industry, mandated to regulate the production and marketing of Flue Cured Virginia (FCV) tobacco in India.
Ministry of Commerce and Industry: The Indian government ministry responsible for international trade and industry.
Flue cured Virginia FCV tobacco: A type of tobacco that the Tobacco Board regulates.
ICAR-National Institute for Research on Commercial Agriculture NIRCA, Rajahmundry, Andhra Pradesh: An Indian Council of Agricultural Research (ICAR) institute involved in tobacco research, located in Rajahmundry, Andhra Pradesh.
Shri Ramnath Thakur: Minister of State for Agriculture and Farmers Welfare
Lok Sabha: The lower house of the Parliament of India, where a written reply was given.
India: The country to which the policy document and the entities mentioned within it pertain.
Ministry of Agriculture & Farmers Welfare
TOBACCO PROCESSING AND VALUE-ADDITION
INFRASTRUCTURE
Posted On: 05 AUG 2025 4:37PM by PIB Delhi
The Department of Agriculture & Farmers Welfare is not implementing any programme / scheme for
promotion of tobacco/tobacco cultivation in the country.
The Tobacco Board under the Ministry of Commerce and Industry is mandated to regulate production and
marketing of Flue cured Virginia (FCV) tobacco. The Board as per its mandate plans the FCV tobacco crop
size, a season ahead and regulates its production. Subsequently, Tobacco Board conducts e-auctions for
ensuring fair and remunerative prices to farmers and assured supply of tobacco to traders.
The Tobacco Board does not directly deal with farm-to-factory linkages to ensure higher returns for tobacco
farmers by promoting value-added tobacco production. However, the Board has taken measures to improve its
marketability in line with the international customer requirements thereby ensuring the realization of the better
prices for the FCV tobacco produced by the farmers. Further, the Board has also taken necessary measures to
protect the farmers from global price volatility to ensure the price stability. Due to focused efforts, the FCV
tobacco farmers were able to increase their income since 2020-21 and the export revenue also more than
doubled during this period. The farmer prices (average) for their FCV tobacco produce increased from Rs.
135.24 per kg in 2020-21 to Rs. 279.54 per kg in 2023-24. The value of export of tobacco and tobacco
products also increased from Rs. 6,496.99 Crore in 2020-21 to Rs. 16,728.02 Crore in 2024-25.
Further, ICAR-National Institute for Research on Commercial Agriculture (NIRCA), Rajahmundry is
involved in research through varietal development, production & protection technologies and leaf quality in
different types of tobaccos grown in different climatic zones of India. ICAR-NIRCA is actively disseminating
technologies and good agricultural practices to farmers.
This information was given by Minister of State for Agriculture and Farmers Welfare Shri Ramnath Thakur
in a written reply in Lok Sabha today.
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RC/ KSR/AR
(Release ID: 2152559)