India’s cabinet will ban the devices with an executive order.
Topline: India announced a ban of e-cigarette production and sales Wednesday, slamming the door on expansion efforts by companies like Juul and cutting off their access to the country’s 100 million adult smokers, at the same time as the devices face widespread crackdown in the U.S.
- India’s cabinet will ban the devices with an executive order, according to Reuters. Executive orders are used when its parliament is out of session, and when it reconvenes in November, lawmakers will have to reauthorize the ban.
- World Health Organization data shows that India’s smoking population is the world’s second largest, after China. And over 1 million people die annually from smoking-related causes.
- The New York Times reported September 12 Juul had planned an expansion into India later this year.
- In response to questions about expanding into India, Juul spokeswoman Victoria Davis said, “We are not in India.”
- Philip Morris (in merger talks with Altria, which owns a 35% stake in Juul) also has an e-cigarette product called the IQOS. It’s available in 40 countries, but will also be impacted by India’s ban.
- Draft documents of India’s ban were reviewed by Reuters in August, which reported that offenders could be punished with fines starting at 100,000 rupees ($7,000) or one year in jail. It’s unclear if India’s executive order will include those punishments.
Key background: India’s ban comes a day after China delisted Juul’s products from two of its major e-commerce sites. Which spells trouble for tobacco companies looking to tap into the world’s largest smoking markets. After splitting in 2008, Altria and Philip Morris began merger talks in August. But regulatory crackdowns on e-cigarettes and an outbreak of vaping-related illness threaten the deal. Globally, the e-cigarette market was worth $11 billion in 2018. And Juul, which posted $1 billion in revenue last year, has already entered the market in Indonesia, South Korea and the Philippines.
