Andhra: Naidu Seeks Rs 150 Crore Relief From Centre As Tobacco Prices Plunge Due To Over Production

Andhra Pradesh Chief Minister N Chandrababu Naidu met Union Commerce and Industry Minister Piyush Goyal in Delhi on Sunday (15 June) to seek the centre's support on a range of agri-export issues. The meeting focused primarily on the ongoing tobacco glut, which has severely impacted farmers growing the HD Burley variety, states a report from The New Indian Express. 

Naidu informed the Centre that the state government had committed Rs 300 crore to procure 2 crore kg of unsold HD Burley stock following a collapse in market prices. During the meeting he requested that the Tobacco Board contribute half the amount, i.e. Rs 150 crore to ease the financial burden and stabilise the market.

The Chief Minister also raised concerns regarding palm oil import duty, aqua exports, and GST on mango pulp.

In a related development, Goyal reviewed the Board’s performance and praised the Board for its performance over the last four years. He however cautioned farmers against exceeding the Board’s acreage limits, stating that overproduction was contributing to the ongoing price crash. He also announced that the interest-free education loan limit for tobacco farmers’ children would be raised from Rs 3 lakh to Rs 5 lakh, with the repayment period extended from three to five years.

The crisis is not limited to the HD Burley variety. According to a report by Business Line last month, there has been a sharp rise in the production of Black Burley tobacco as well, leading to excess supply. Compared to the usual output of 30 million kg, the production had surged to 80 million kg.