Assigement on Tobacoo Industery

1. 1
IIMT SCHOOL OF MANAGEMENT
(ISM)
Managerial Economics
Semester – 1
Academic Year 2013-14
Module Leader
Ms. Neetu Ahmed
Submitted By
Rishabh Shukla
Post Graduate Diploma in
Management

2. 2
INDEX
1. Tobacco industry in India
1.1 Introduction
1.2 Market capitalization
1.3 Size
1.4 Top leading companies
1.5 Employment opportunities
1.6 Latest development
2. Manufacturing industry
2.1 introduction
2.2 main manufacturing companies
2.3 Pros and Cons
3. Agriculture industry
3.1 Introduction
3.2 Top leading companies
4. Service industry in India
4.1 Introduction
4.2 Growth and share
4.3 Top leading companies
5. Inter relationships
6. Growth of Indian economy
7. Executive summary
8. Conclusion
9. Reference

3. 3
Manufacturing industry in India and Relationship between Agriculture,
Manufacturing and Service Industry in India
1. Tobacco Industry in India
1.1 Introduction
India is the second largest producer of tobacco in after China. India holds a meagre of 0.7% of
share in the global trade in tobacco. Cigarettes account for a India is 85% of the total tobacco
exports. Around 48% of the tobacco consumed in the form of chewing tobacco in total
production. And the rest of the tobacco consumed in a form of 38% in Biddies and 14% as
cigarettes.
www.reaseachandmarket.com (23/10/2013)
Downloaded as www.googleimage.com as on 25/10/2013
As the per capita consumption of cigarettes in India is a tenth of the world average. In the recent
past year a consumption of tobacco is reduced by anti-tobacco drives and ban of tobacco
consumption in public area. The biggest player in India is ITC in tobacco industry. ITC has a
72% of share in a Indian tobacco industry. The governments of India increase taxes on tobacco
products in the budget for the fiscal year 2012-13. Health experts say that taxes must be
increased in tobacco product so consumptions of tobacco product must be decrease in
particularly 8% in low and middle level income India. The Indian tobacco industry has been
growth in very fast in recent past few years, but is forecast to slow down a Indian tobacco
industry in a next few years. Because Indian government has make a very strict rules and
regulations in a uses and selling of tobacco product in India. Cigarettes are very usually ad the
leading segment in most of the countries
www.Indianmirror.com (23/10/2013)

4. 4
1.2 Market Capitalization of Tobacco Industry in India
The Indian tobacco industry generated $9.9billions of total revenues in 2007. Its represent a
6.6% of CAGR (compound annual growth rate) in the five years period spanning 2003-07. ITC
is a leading tobacco company in India its leads a 72% of share in a India tobacco industry.
www.Indianmirror.com (23/10/2013)
1.3 Size of the Indian tobacco industry
Today time 80 nations of the world are used a tobacco products and exports tobacco products.
The Indian tobacco industry provided a job opportunity to more than 25 Millions people to job
opportunity in India. The unmanufactured tobacco share around 85-85% to total exports shares in
India. International trends say that non cigarette tobaccos are a dominating item in a national
export. Current situations say that Indian tobacco market is a favourable market in a world.
Because there is many several advantages like low unit production cost, average exports prize of
tobacco. India is a second largest producer of the world after a China. China has produced a 30,
00,000 tones and India is produced a 6, 00,000 tones. India is a fourth largest consumer of the
world. There are many types of tobacco are grown in India.
www.marketandresearch.com (23/10/2013)
1.4 Top LeadingCompanies
1- Kanhayya Tobacco Company
2- M.R. Tobacco
3- Sapna Enterprises
4- Sudarshan Tobacco
5- ITC Company
1.5 Employment Opportunities
There are few more tobacco companies in India. There are many tobacco companies made a
name in a Indian tobacco market but they are no way close to ITC. India is a second largest
producer of the world. Indian tobacco industry share is rise 9% to 11% in the last three decades.
Andhra Pradesh, Gujarat and Karnataka is a largest producer of a India. They are produced a
80% of a production of a total Indian tobacco industry production.
www.marketandresearch.com (23/10/2013)
1.6 Latest Development
India is a second largest producer in this time after a China in the world. India 48.5% of tobacco
consumed in the form of chewing tobacco. 38% as the form of Biddies and 14% consumed in a
form of cigarettes. India is a tenth largest producer of cigarettes in per capita consumptions. In
recent past year the consumptions of tobacco in India is reduced by anti tobacco drives and the
ban of the tobacco consumptions in public place. ITC is a biggest player in the Indian tobacco
industry.
www.marketandreseach.com (23/10/2013)

5. 5
2. Manufacturing Industry in India
2.1 Introduction
Indian manufacturing industry is a wheel of the economics progress. This sector contributes a
16% of GDP (Gross Domestic Production) in February 12. India has realized a importance of
manufacturing sector after the 1990 Economics liberalization era. The recent time country has
introduced a systematic plan for the manufacturing industry. Now this time Indian government
and India Inc focusing on implementation of this plan. Today time Indian government makes a
high level committee on manufacturing sector. This committee worked in a field of sustained
growth of manufacturing sector. Manufacturing committee lead by Dr. Manmohan Singh, The
prime minister of India. Manufacturing committee main object is a manufacturing industry
growth in 8-9%. According to the UNIDO, India is the largest producer of chemicals, textiles,
basic metals, machinery and equipment etc.
www.ibef.org (23/10/2013)
www.googleimage.com (as on 23/10/2013)
The Indian manufacturing sector generates a large scale of employment in organized sector.
There are many key challenges for a growth for a Indian manufacturing sector in India. Such as
infrastuer deficit, land acquisition, environmental clearances, labour related issue, multi-tier
regulatory framework and complex procedure. Indian manufacturing sector considered as a high
quality manufacturing destinations. Indian manufacturing sector favorable demographic dividend
for next 2-3 decade. Strong consumptions in the Indian market. India is a strong technical
capability backed by top technical institutes. But there are some weakness of Indian
manufacturing industry such as low employee productivity, high illiteracy, poor power and
transport infrastuer, regular rollback on policy, rising input costs of fuel, labour etc. and slow
pace of reforms and policy implementation.
www.cii.in (23/10/2013)
Indian government decided to bring the national manufacturing policy and government decided
to quantitative and qualitative changes for following objectives. Increase a manufacturing growth
at least 25% of the national GDP by 2022. Increase a minimum 100 million jobs in 2022.
Increase a technological depth in manufacturing sector. Enhance global competitiveness of
Indian manufacturing through appropriate policy support.
www.businessgov.in (23/10/2013)

6. 6
Manufacturing’s share of GDP in the top 15 manufacturing nations
Source : United Nations Statistics Division; US Bureau of Economic Analysis ; Mckinsey Global
Institute analysis (As on 24/11/2013)
2.2 Main Manufacturing Companiesin India
1- Hindustan Unilever Ltd.
2- Ranbaxy
3- Bajaj Auto
4- TVS Motors
5- Videocon Group
www.cii.in (as on 24/10/2013)
2.3 Pros and Cons of Indian ManufacturingIndustry
2.3.1. Pros
1) Establishing commercial law and this law based on British common law.
2) Well established protection of intellectual property rights and recognitions.
3) Manufacturing facility.
4) Accessibility of current market.
5) More innate commitment to product quality control.
6) Universal ability to speak English among professional class.
0
5
10
15
20
25
30
35
Manufacturing share of GDP, 2010
China
South Korea
Indonesia
Japan
Germany
Mexico
Italy
Russia
Brazil
India
Spain

7. 7
2.3.2. Cons
1) Extremely undeveloped infrastructure like Transportation, Energy production and
distributions.
2) Increased logistics costs.
3) Bureaucracy.
4) Indian manufacturing industry not a member of WTO.
www.exinglobal.typepad.com (As on 24/10/2013)
3. AgricultureIndustry in India
3.1 Introduction
Agriculture industry is most important industry in India. It’s a backbone of Indian economy.
Agriculture sector plays a vital role in the development of Indian economy. Most of the industry
is depend on the agriculture sector for their raw materials. India gains a first ranks in the
production of pulse, milk, jute etc; second in the wheat, rice, vegetable, groundnut, fruit,
sugarcane etc. India is a world leading producer of spices and plantation crops as well as
fisheries and poultry.
www.googleimage.com (as on 24/10/2013)
According to the survey and analysis the total turnover of Indian food market is Rs. 250000
crores. The Indian agriculture industry contribute a over 35% of GDP and provided a
employment around 65% of the population. Indian government has set a target of 259 million
tones of food grains production in 2013-14. The Indian government has permitted a 100% FDI in
agriculture industry, subject to certain rules in Floriculture, Horticultuer and Apiculture under
controlled conditions. Indian governments open a 71 pesticide testing lab across the countries
that include 1 central lab, 2 regional labs and 68 state labs. Indian government has launched a
SMS portal for farmers on 16 July 2013. This portal provided relevant information, giving
seasonal and topical advisories and provided a service through SMS. . Department of agriculture
under the mystery of Indian government work in the field of development of agriculture sector in
India. India 65% of population still related for agriculture for livelihood and employment
www.ibef.org (as on 24/10/2013)

8. 8
3.2 Top LeadingCompaniesin AgricultureIndustry
1- Monsanto
2- Rallis
3- H.J. Heinz
4- Advanta India Ltd.
5- Phalada Agro Research Foundation Ltd.
6- Poabs Organic Estates
7- National Agro Industries
8- ABT Industries
4 Service Industry in India
4.1 Introduction
Service sector is a vital cog in the Indian economy. Service sector accounting for 60% of the
GDP grew 55 in the February 2013. The Indian service industry is a very fastest growing
industry and largest industry on the global level. Indian service industry comprise of wide range
of activities such as transpirations, trading real state etc.
www.business.gov.in (as on 24/10/2013)
www.googleimage.com (as on 24/10/2013)
According to the department of industrial policy and promotions Indian service industry enjoyed
FDI inflows accounting to US$ 547 million during April-May 2013-14. Insurance and real estate
grew by 9.1% in January-March quarter of 2013. Hotel, trade, transport segment grew by 6.6%
in January-March quarter 2012-13. E-Commerce and internet are fastest growing service sub
sector in the Indian economy.
www.ibef.org (as on 24/10/2013)

9. 9
The CMIE (Center for Monitoring Indian Economy’s) analysis service industry for a sector wise.
The CMIE show that data of the performance of sector such as transport logistics, aviation and
construction in the year and CMIE compared a data for previous years. The health and telecom
sector is projected for a rebounded in the year 2012-13. According to Indian economics survey
2013-14 is a better for a most of the sector for a service industry. The Indian IT sector has facing
a competition for a many developing countries. EU has a highest shares in IT and computer
exports. Many new competitions like China, Israel and Philippines etc. Between a 2005 to 2011,
the annual growth rate of computer service was 69% in Philippines, 28 % in Sri Lanka, 27% in
Russia.
www.marketandresaerch.com (as on 24/10/2013)
4.2 Share and Growth of India’s Service Sector (at factor cost) (Percent)
2000-
01
2005-
06
2006-
07
2007-
08
2008-
09
2009-
10
2010-
11
2011-
12
2012-
13
Trade, hotels &
Restaurants
14.6
(5.2)
16.7
(12.2)
17.1
(11.1)
17.1
(10.1)
16.9
(7.9)
16.5
(7.9)
17.2
(11.5)
18.0
(6.2)
25.1#
(5.2)
Trade 13.3
(5.0)
15.1
(11.6)
15.4
(10.8)
15.4
(9.8)
15.3
(6.7)
15.1
(8.5)
15.7
(11.5)
16.6
(6.5)
Hotels &
Restaurants
1.3
(7.0)
1.6
(17.4)
1.7
(14.4)
1.7
(13.0)
1.5
(-3.3)
1.4
(1.9)
1.5
(10.8)
1.5
(2.8)
Transport,
storage &
communication
7.6
(9.2)
8.2
(11.8)
8.2
(12.6)
8.0
(12.5)
7.8
(10.8)
7.7
(14.8)
7.3
(13.8)
7.1
(8.4)
Railways 1.1
(4.1)
0.9
(7.5)
0.9
(11.1)
1.0
(9.8)
0.9
(7.7)
0.9
(8.8)
0.8
(5.9)
0.7
(7.5)
Transport by
other means
5.0
(7.7)
5.7
(9.3)
5.7
(9.0)
5.6
(8.7)
5.5
(5.3)
5.3
(7.3)
5.3
(8.2)
5.4
(8.6)
Storage 0.1
(6.1)
0.1
(4.7)
0.1
(10.9)
0.1
(3.4)
0.1
(14.1)
0.1
(19.3)
0.1
(2.2)
0.1
(9.4)
Communication 1.5
(25.0)
1.6
(23.5)
1.5
(24.3)
1.4
(24.1)
1.4
(25.1)
1.4
(31.5)
1.1
(25.4)
0.9
(8.3)
Financing,
insurance, real
estate & business
service
13.8
(4.5)
14.5
(12.6)
14.8
(14.0)
15.1
(12.0)
15.9
(12.0)
15.8
(9.7)
16.0
(10.1)
16.6
(11.7)
17.2
(8.6)
Banking &
insurance
5.4
(-2.4)
5.4
(15.8)
5.5
(20.6)
5.5
(16.7)
5.6
(14.0)
5.4
(11.4)
5.6
(14.9)
5.7
(13.2)

10. 10
Real estate,
ownership of
dwellings &
business services
8.7
(7.5)
9.1
(10.6)
9.3
(9.5)
9.6
(8.4)
10.3
(10.4)
10.4
(8.3)
10.4
(6.0)
10.8
(10.3)
Community,
social & personal
services
14.8
(4.6)
13.5
(7.1)
12.8
(2.8)
12.5
(6.9)
13.3
(12.5)
14.5
(11.7)
14
(4.3)
14.0
(6.0)
14.3
(6.8)
Public
administration &
defense
6.6
(1.9)
5.6
(4.3)
5.2
(1.9)
5.1
(7.6)
5.8
(19.8)
6.6
(17.6)
6.1
(0.0)
6.1
(5.4)
Other service 8.2
(7.0)
7.9
(9.1)
7.6
(3.5)
7.4
(6.3)
7.5
(7.4)
7.8
(7.2)
7.9
(8.0)
7.9
(6.5)
Construction 6.0
(6.1)
7.9
(12.8)
8.2
(10.3)
8.5
(10.8)
8.5
(5.3)
8.2
(6.7)
8.2
(10.2)
8.2
(5.6)
8.2
(5.9)
Total service 50.8
(5.4)
53.1
(10.9)
52.9
(10.1)
52.7
(10.3)
53.9
(10.0)
54.5
(10.5)
54.4
(9.8)
55.7
(8.2)
56.5
(6.6)
Total service
(incl.
Construction)
56.8
(5.5)
61
(11.1)
61
(10.1)
61.2
(10.3)
62.4
(9.4)
62.7
(10.0)
62.6
(9.8)
63.9
(7.9)
64.8
(6.5)
Total GDP 100
(4.3)
100
(9.5)
100
(9.6)
100
(9.3)
100
(6.7)
100
(8.6)
100
(9.3)
100
(6.2)
100
(5)
Source: Central Statistics Office (CSO) (As on 25/10/2013)
1- Notes: 1- Shares are in current prices and growth in constant prices.
2- Figure in parenthesis indicate growth rate.
4.3 Top leading companies in Service Sector
1- Tata Consultancy Service Ltd.
2- Wipro Ltd.
3- iGate
4- HCL Technologies Ltd.
5- Polaris Software Lab Ltd.

11. 11
5. Inter relationship between Agriculture, Manufacturing andServiceSector in
the IndianEconomy
India is one of the highly industrial countries. It has a populations of over 121 Crore. The study
of industry relationship in a India has assumed importance for the economic reforms. India can
now freely compete for capital and design policy for attracting investment. The relationship
between agriculture, manufacturing and service industry is very important in any economy
development. Because whole process of development can be understood in the context of
relationship between agriculture, manufacturing and service industry evolution. Agriculture
industry and manufacturing industry very closely related to each other because manufacturing
industry depends on raw materials and raw material provide a agriculture industry. Farmer is
producing crops and sells for a manufacturing industry. Manufacturing industries uses raw
materials and makes products and sell in the market. I am take restaurant as a example it’s a very
good example for explain a inter relationship between agriculture, service and manufacturing
industry. Restaurants are provided a food product for its consumer. Food products are making for
raw materials and raw materials are available thought a agriculture industry. And we are no
restaurant are come in the service industry because they are provided a service for a consumer.
So we can see that one both of the industry is very closely depended of each other. Restaurant
business is also depended on a all type of the industry. It become more and more clear that one
sector cannot properly developed without the other.
6. Growth of Indian Economy
Indian economy is a growing economy. India economy is growing very rapidly in recent years.
There are some major issue to India’s growth are infrastructure shortage, unreformed financial
sector in India, labor regulations, large fiscal deficit. There are many challenges for growth of
Indian economy.
 Indian economy needs to invest a 3-4% more of its GDP on infrastuer to sustain 8%
growth.
 Improving the capacity to implement infrastuer projects will be a important part of
increasing a investment.
 Public sector can play a very importance role in infrastuer, including through the PPP
(Public Private Partnership).
Dowmloaded www.cii.in (as on 25/10/2013)

12. 12
The country considered a fiscal deficit for a many large years. Indian financial sector lead to a
booming stock market that has helped a large finance for a firm.
www.marketandresearch.com (as on 27/10/2013)
7. Executive Summary
India’s tobacco industry is on a high growth industry. Indian tobacco industry is a second
position of a world tobacco industry after a China. ITC is a biggest player of an Indian tobacco
industry. Its holds highest shares of a Indian tobacco industry. Indian manufacturing industry is a
high growth industry of India and Indian government makes a different policy for a
manufacturing sector. Indian manufacturing sector growth is a very good role for a development
of a Indian economy.
8. Conclusion
On the basis of above discussion we can say that Indian economy is a very fast growing
economy of the world. Indian tobacco industry is a second position in a world tobacco industry
after a China. And Indian manufacturing, service and agriculture industry is also a growing for a
very good rate. Indian government also promotes an all type of industry in India. And makes new
plans for a development of all type of industry. But Indian government need to makes a strong
and very long term policy for a manufacturing, agriculture and service industry. in this time both
of the sector are play a very good role for a development of a Indian economy. If Indian
government makes a good and long term policy in both of the sector and implement a all of the
policy in timely so Indian economy is a gain a first position in a world economy.
9. Reference
1- http://www.ibef.org/exports/tobacco-industry-India.aspx
2- http://www.researchandmarkets.com/reports/2089802/analyzing_the_tobacco_industry_in_I
ndia
3- http://www.Indianmirror.com/Indian-industries/tobacco.html
4- http://www.Indianmirror.com/Indian-industries/2013/tobacco-2013.html
5- http://www.ibef.org/industry/services.aspx
6- http://business.gov.in/Industry_services/services_sector.php
7- http://www.ibef.org/industry/manufacturing-sector-India.aspx
8- http://www.ibef.org/industry/agriculture-India.aspx
9- http://www.cii.in/Sectors.aspx?enc=prvePUj2bdMtgTmvPwvisYH+5EnGjyGXO9hLECvTuNv
CXClqMiUluXn1qQ54jikN
10- http://www.ibef.org/industry/manufacturing-sector-India.aspx
11- http://exinglobal.typepad.com/going_global/2006/05/china_or_India_.html
12- http://www.Indianmirror.com/Indian-industries/agricultural.html
13- http://www.cii.in/Sectors.aspx?enc=prvePUj2bdMtgTmvPwvisYH+5EnGjyGXO9hLECvTuNvCXCl
qMiUluXn1qQ54jikN
14- http://India.gov.in/topics/agriculture

13. 13
15- http://forbesIndia.com/article/real-issue/Indias-services-sectorbased-economic-model-is-its-
problem/36169/1
16- http://www.ccsenet.org/journal/index.php/ijbm/article/view/311
17- http://www.researchandmarkets.com/reports/2089802/analyzing_the_tobacco_industry_in_I
ndia
18- http://www.Indianmirror.com/Indian-industries/tobacco.html
19- http://www.Indianmirror.com/Indian-industries/2013/tobacco-2013.html
20- http://exinglobal.typepad.com/going_global/2006/05/china_or_India_.html
21- http://erawatch.jrc.ec.europa.eu/erawatch/opencms/information/country_pages/in/policydoc
ument/policydoc_0005
22- http://planningcommission.gov.in/aboutus/committee/strgrp12/str_manu0304.pdf
23- http://planningcommission.gov.in/plans/planrel/12thplan/pdf/12fyp_vol1.pdf
24- http://www.ibef.org/download/Indian-Manufacturing-110512.pdf
25- http://equityupdates.com/2012/12/trends-in-manufacturing-industry-in-India/
26- http://www.ibef.org/download/Indian-Manufacturing-110512.pdf
27- http://Indiabudget.nic.in/es2012-13/echap-10.pdf
28- http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/SOUTHASIAEXT/EXTSARRE
GTOPMACECOGRO/0,,contentMDK:20592481~pagePK:34004173~piPK:34003707~theSit
ePK:579398,00.html
29- http://www.jagranjosh.com/current-affairs/economic-survey-of-India-201213-industry-and-
services-sector-1363250714-1