The Government of India (GOI) dropped a bombshell on tobacco Industry on Feb 6, 2001 to ban tobacco companies from advertising their products and sponsoring sports and culture events. The idea of this ban was to minimize or prevent adults, teens and young children from consuming tobacco products. Suhel Seth, CEO, Equus Advertising was very unhappy about the implementation of the ban, he quote “the ban does not have teeth. It is a typical knee-jerk reaction by any Government to create some kind of popularity for itself.
The Legislation has not been thought thorough”. After the decision the Government made, ITC withdraw itself form all the sponsorship events. In a statement it quotes,” ITC believes that this action on its part will create the right climate for a constructive dialogue that will help develop appropriate content, rules and regulations to make the intended legislation equitable and implementable.” For your assignment, write a 3 page (double-spaced) case analysis in which you address the following questions:
1. Summarize the arguments in favor of the ban on tobacco advertising in India 2. Summarize the arguments in opposition of the ban on tobacco advertising in India 3. Discuss the conflict of interest issue as it pertains to government in India 4. Give your opinion on what governments should do in regards to tobacco advertising 1) Summary of Arguments for the Ban a) The ban has come a long way, because not only India, but, France, Norway, Finland and New Zeeland also had similar rules forbidding tobacco advertising. The report used by UK government showed a significant reduction in tobacco consumption in countries who had banned advertising. b) Tobacco was being compared with as an additive drug such as Cocaine which is banned worldwide. c) They were also other precedents have been set, where dangerous products are banned from being advertised even if it was still been sold e.g. firearms, pharmaceutical products.
d) The Government were concerned with the impact on public health citing the research done by the World Health Organization (WHO) have proved that over 3 million deaths had been reported and the numbers have been increasing to 4.023 million in 1998. The concern that the deaths would increase significantly by 2020-30. e) The Government was concerned about the health of the youth, an internal document released in America described 14 to 23 years as tomorrow’s customers. There was documented evidence in Indonesia showing advertisements had bad influence on young teens and even children under the age of 6. f) The government study showed a favorable impact economy with the reduction in Gross Domestic Product would be more than offset by a reduction in health costs. Also the report highlighted that money spent of tobacco would be spent on other products boosting other parts of the economy.
2) The Summary of Arguments Against the Ban a) However the Nays’ were very unhappy of the ban of tobacco on grounds of free choice. Amit Sakar, Editor, Tobacco News, said that people are not forced to smoke, they all are adults and can be responsible for their own actions and determine what is good and what is bad for their health. He was concerned “If we lose sight of this principle, then we lose sight of the truth on which all the free societies depend, namely that freedom and risks are inextricable, and whomsoever assumes the right to save us from risks, is also assuming right to limit our freedom”.
b) The tobacco companies insisted that the reason for marketing this product was to help adults to make an informed brand choice. They did not advertise cigarettes to target nonsmokers like young teens and children under the age of 6 nor did they seek to influence them to smoke, they namely targeted adults that were already smoking. They cited a survey conducted by the Indian Market Research Bureau where 49% started smoking to see what it was like and a further 24% started because of friends smoking. c) Analysts felt that the banning of the ads will reduce the progression of Indian consumers up the scale from harmful tobacco consumption (like ghutka, zarda etc.). too better quality products.
d) The Nays disputed the Government analysis on the economic effects. With India being the 3rd largest tobacco maker in the world with an annual output of 550 million kg. Contributing in 2000-01 it contributed Rs 8,182 core which was 12% of national revenue and surprisingly 90% of it came from cigarettes. Employing over 26 million people both directly & indirectly they were concerned that the ban would leave millions of them jobless. e) The Nays’ also pointed out that the government spent less funds on public health, insurance and pension systems were very poor, resulting, in the government having to spend more money on pensions if less people die of illnesses caused by tobacco.
f) Number of research studies determined that advertising did not influence people to smoke and that there was only weak correlation between the money spent by cigarette companies on advertisements and the consumption of the product. The research done by the Norwegian National Council compared European countries that had smoking trends and discovered that Norway’s smoking trends have never changed before the ban was implemented in 1975 all the way to 1995. It had the highest proportion of adult smokers amongst all other European countries. Finland imposed the banning of tobaccoadvertising in 1978, according to the research done in 1990’s show that the numbers of adult smokers have increased since the late 1980’s. A study done in 1993 proved that banning tobacco advertisements did not reduce the consumption of tobacco.
3) The Haze The consumption of tobacco was increasing in the developing countries and decreasing in developed countries. By implementing the ban, the government was hoping to reduce the numbers of smokers. Certain studies showed numbers were still increasing after a ban on tobacco advertisements. Then there was the question of choice and where you draw the line Shunu Sen, CEO, Quadra, Advisory quote” excess of anything is bad. Excess of coffee, tea, whatever. Where do we draw the line?”. The ban was unjustified, as the advertisements didn’t promote smoking.
4) The Conflict of Interest a) Making decisions impacting freedom of choice in a free society is difficult. However, the Government also a duty of care to it citizen’s b) The were powerful vested interests against the ban, and the ban would affect sponsorship of major sporting events. c) The Ghutka industry has put up advertisements in leading national dailies, blaming faulty policy decisions that made Ghutka sale and consumption illegal in India d) The statistics showed mixed results and the impact on the economy was uncertain and public opinion could go against the government.
5) Opinion From my prospective, I think that the government was moving into the right direction for banning tobacco advertisements. They should have in my opinion considered banning the product itself because it could be a waste of time and energy by implementing the ban of advertisements only and not the product, banning of advertising alone would not reduce the number of smokers, with the risk of the number smokers increasing in following years. Tobacco have mental and physical effects, dying from smoking is rarely quick and never painless. A typical addicted smoker will take 10 puffs on a cigarette over 5minute period. Thus smokes 1 72 packs or 30 cigarettes daily and gets 300 “hits” of nicotine each day. 30 cigarettes daily x 365 days a year = 10,950 cigarettes per year, 10,950 x 6.50 average price of a pack of cigarettes = 3,558.75 per year, using limited money to fund the habit, which would be better spent on more essential items.
It is difficult for addicted people to stop smoking and exercise the free will to stop smoking even if they accept the dangers to their health. This is an example of Indonesia, whereby 7/10 men smoked and 1/50 children started smoking at the age of 2-4. There has been a 2 cases whereby a 3 years and 6 month old have been smoking 40 cigarettes a day and another 9 year old who have started smoking when he was only 4 years old and said that he was taught by teenagers, “it taste better then candy” the boy said. Both boys were Jakarta, Indonesia. This could also happen in India I think the Government needs to strong line against tobacco additions and safeguard the health of its citizen’s and young people in particular.