Beedi industry doubles in size and threatens Sri Lanka’s economy

• 5opn1
• November 15, 2024
• Business News
• Beedi industry
• 0 Comments

While Sri Lanka has made notable progress in tobacco control, with policies reducing cigarette consumption, the unchecked growth of the beedi industry presents a mounting threat to the economy.

The informal nature of the beedi trade makes it difficult to regulate, allowing it to flourish despite stringent measures applied to the formal tobacco industry. According to the Research Intelligence Unit’s 2023 report, the beedi industry has more than doubled in size, growing from 3.01 billion sticks in 2015 to 6.51 billion in 2023.

Meanwhile, the duty-paid cigarette market has shrunk significantly, with consumption dropping to 0.9 billion sticks the first half of 2024.

The economic implications of this shift are profound. Cigarettes, being part of the formal economy, are subject to excise duties and taxes, making them a substantial contributor to government revenue