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Newslaundry
Newslaundry
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NL Team

RSS arm bats for ITC, but says it doesn’t support tobacco

Swadeshi Jagran Manch’s (SJM) endorsement for using Indian conglomerate ITC’s Fast Moving Consumer Goods (FMCG) products over that of multinational companies comes as a bit of a surprise. SJM is, after all, an arm of the right-wing group, Rashtriya Swayamsevak Sangh (RSS).

SJM’s national co-convenor Ashwani Mahajan tweeted this earlier in the week.

He had tweeted in favour of using ITC products, a leading tobacco company in India that also makes other items.

When Newslaundry contacted Mahajan, he said, “SJM doesn’t support tobacco business of any entity desi or foreign. We were referring to products other than cigarettes.”

But, when one talks of ITC, reference to tobacco cannot be far behind. ITC, previously known as Indian Tobacco Company, is now officially known by just its initials.

Not surprisingly, Cigarettes and Cigars are listed as one of the top FMCG products on the ITC website. Other FMCG products sold by ITC include Foods, Lifestyle Care, Education and Stationery, Agarbattis and Safety Matches.

In fact, just cigarettes alone account for a major chunk of ITC’s net segment revenue in FMCG, beating off competition from its food, lifestyle, personal care, education stationery, agarbattis and matches, all put together.

Even as Mahajan tweeted in favour of ITC, he told Newslaundry, “We are not supporting one company. We publish many pamphlets every year saying that you should purchase desi products and boycott MNCs.”

Mahajan claimed that he was unaware that ITC sells cigarettes under its FMCG products vertical. “I am least bothered about what ITC says. In SJM, we believe that cigarette is not an FMCG product but a demerit product,” he said. Demerit goods are those goods which are not beneficial to the consumers.


A closer look at ITC’s statement of standalone and consolidated financial results reveal that cigarettes account for a segment revenue of Rs 24,848.09 crore in consolidated results of twelve months ending March 31, 2018.

According to the Ministry of Corporate Affairs (MCA), a business segment is a distinguishable component of an enterprise that is engaged in providing an individual product or service or a group of related products or services and that is subject to risks and returns that are different from those of other business segments.

Simply put, ITC stands to generate a revenue, that is income from sales of goods and services, in this case, from cigarettes and cigars, of up to Rs 24,848.09 crore, more than any of its other business segment, FMCG or otherwise.

Segment Revenue – Consolidated Results of twelve months ending March 31, 2018

a) FMCG (Cigarettes – Rs 24, 848.09 cr; Others – Rs 11, 357.38 cr)

b) Hotels – Rs 1494.67 cr

c) Agribusiness – Rs 8155.04 cr

d) Paperboards, Paper and Packaging – Rs 5249.64 cr

e) Others – Rs 1602.43 cr

(Source: ITC Limited’s statement of standalone and consolidated financial results)

Mahajan told Newslaundry, “MNCs take away multiple times more than what they bring in the country. We, as a nationalist organisation, are opposed to that.”

But how swadeshi is ITC? A look at the annual report for 2017 reveals that 20.03 per cent shares of ITC Limited are held by foreign portfolio and institutional investors. Apart from this, 29.81 per cent shares are held by foreign companies.

Tobacco Manufacturers (India) Limited, which is a subsidiary of British American Tobacco, owns 24.68 per cent shares in ITC. Even the Government of Singapore has a small stake, at 1.33 per cent.

Business Standard reported in February last year that with no visible promoter group, London-based British American Tobacco (BAT) is currently the biggest shareholder in ITC with 24.77 per cent stake.


Mahajan also noted that the Manch continues to support the beedi industry: “Our heart is with the beedi-tendu Patra workers till they find an alternative (work),” he said.


ITC has a history of running into troubled waters. Only last year a public interest litigation was filed in Bombay High Court by Tata Trusts, Tata Memorial Hospital and a group of activists, challenging Life Insurance Corporation’s (LIC) shareholding in ITC Private Limited.“How can an entity which insures lives of people have stake in a company that makes profits out of selling tobacco, that kills people?” asked Dr Pankaj Chaturvedi, onco-surgeon at Mumbai-based Tata Memorial Hospital who is a party to the PIL.

A copy of the PIL can be accessed here.

Earlier, Central Board of Secondary Education (CBSE) through a circular had banned the ITC-sponsored Spell Bee competitions in all its schools, citing the fact that it cannot support any contest held by a company that also manufactures cigarettes.

But, clearly, the ITC’s core business does not pose any dharam sankat to the RSS.

Newslaundry is a reader-supported, ad-free, independent news outlet based out of New Delhi. Support their journalism, here.

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