Foreign Direct Investment (FDI) in the tobacco sector may face tighter restrictions in the near future, according to sources familiar with the matter speaking to CNBC-Awaaz. The government is reportedly considering expanding the scope of FDI curbs specifically aimed at companies involved in cigarette manufacturing.
The proposal suggests that FDI restrictions could soon extend to encompass franchises of tobacco products, trademarks, branding related to tobacco, and similar substitutes, the report indicated.
Currently, government regulations already prohibit any FDI in the manufacturing of tobacco products.
Following the news, shares of major tobacco companies such as ITC, Godfrey Phillips, VST Industries, NTC Industries, and Golden Tobacco experienced declines ranging from 1 to 3 percent.