LAW MIN NOD TO BAN FDI IN WHOLESALE TOBACCO TRADE

The law ministry has said it favours the commerce ministry's move to ban Foreign Direct Investment (FDI) in wholesale trading in tobacco. Currently, the manufacturing of tobacco and tobacco substitutes are under the prohibitory list of the FDI press note, while such investment is allowed up to 100 per cent in wholesale trading of cigarettes and other related products under the cash and carry category - albeit under the approval route. Under the guidelines, foreign tobacco companies bring
in money for branding and advertising, while selling to retailers directly can only be done by their Indian joint venture partner.