The federal government’s ongoing debate about devolving the Pakistan Tobacco Board (PTB) to provincial control is quickly escalating into a high-stakes political issue. While the move is presented as part of the 18th Amendment’s devolution process, its implications could be far-reaching, with severe consequences for Pakistan’s economy, public health, and global standing.
At the forefront of the campaign is Khyber Pakhtunkhwa (KPK), a province notorious for its deep-rooted illicit tobacco manufacturing industry. Many of these illicit producers, particularly in the Mardan region, are politically connected and have evaded regulation for years. These tax-evading producers have benefited from a lack of oversight, allowing them to undermine both the formal tobacco industry and the nation’s efforts to combat illicit trade.
The stakes are much higher than political power struggles. Shifting PTB’s authority to provincial governments, especially one that is home to a significant portion of the illicit tobacco trade, could trigger an economic disaster. Pakistan’s formal tobacco industry, including exports, contributes over USD 175 million annually to the national economy, with projections indicating this figure could exceed USD 1 billion in the next five years. However, if control is fragmented, this growth trajectory could be jeopardized, and illicit trade could expand exponentially, potentially costing the economy over USD 2 billion annually.
This isn’t just about numbers but protecting Pakistan’s economic future. The tobacco industry is not only a vital source of revenue but also plays an essential role in providing jobs for millions of Pakistanis, particularly in rural areas. Without a unified, federal regulatory framework, the risk of weakening the formal tobacco sector is immense, and the benefits of a robust, well-regulated industry could be lost.
The implications of this decision stretch beyond national borders. As a signatory to the WHO Framework Convention on Tobacco Control (FCTC), Pakistan is obligated to enforce tobacco regulations at the federal level. Fragmenting the PTB’s jurisdiction could be seen as a violation of these international obligations, weakening Pakistan’s credibility on the global stage and undermining its commitment to tobacco control efforts. Rana Tanveer Hussain, a Member of the National Assembly and an advocate for the formal tobacco industry, emphasized the urgency: “Tobacco is a key contributor to rural employment, national revenue, and export income. We must act now to protect growers and ensure economic stability.”
The decision to devolve PTB control is a dangerous gamble. Fragmenting oversight would weaken the formal sector, harm Pakistan’s global standing, and fuel the illicit tobacco trade. This risk is one the country cannot afford to take.
