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Tobacco is a principal cash crop of National importance. It has been playing a prominent role in the development of Nation's Economy. India ranks 4th in the total tobacco consumption in the world.  Chewing tobacco has been a tradition in India for centuries. Of the total amount of tobacco produced in the country, around 48% is in the form of chewing tobacco, 38% as bidis, and only 14% as cigarettes. Thus, bidis, snuff and chewing tobacco (such as gutka, khaini and zarda) form the bulk (86%) of India’s total tobacco production. In the rest of the world, production of cigarettes is 90% of total production of tobacco related products.Tobaccois an agricultural product processed from the leaves of plants in the genus Nicotiana. It can be consumed, used as an organic pesticide and, in the form of nicotine tartrate; it is used in some medicines. In consumption it most commonly appears in the forms of smoking, chewing, snuffing, or dipping tobacco, or snus. In the chewing segment, the panmasala is a favourite at Indian homes. It is a mixture of nuts, seeds, herbs, and spices which is served after meals in India. Various versions of pan masala are also served in the Middle East and parts of Southeast Asia, where they are treated as mouth fresheners. The tradition of chewing breath fresheners after meals is ancient, and it has a very long history in India in particular. In eras before regular dental hygiene, things like pan masala helped to keep the breath fresh and to support dental health. Some pan masala mixtures even have herbs and spices with antibacterial properties which benefit oral health, and pan masala also sometimes includes stimulant herbs to give people energy after eating. The Indian markets are flooded with a lot of varieties for consumption.

In India, the second most important tobacco consumer, smoking of conventional cigarettes accounts for only 25 percent. Most people consume tobacco in the form of non-cigarette items such as hand-rolled bidis, chewing etc. Total demand for tobacco in India is likely to continue to increase, but more slowly than in the previous decades. About 100 countries produce tobacco. The major producers are China, India, Brazil, the US, Turkey, Zimbabwe and Malawi, which together produces over 80 percent of the world's tobacco. China alone accounts for over 35 percent of world production. World tobacco production is projected to reach over 7.1 million tonnes of tobacco leaf in the year 2010, up from 5.9 million tonnes in 1997/99. This is lower than the record tobacco production of 1992 of 7.5 million tonnes.

World tobacco demand is expected to increase until the year 2010 due to population and income growth, but at lower rates than in the past, according to a new study published by FAO.

Tobacco is a large employer, but it also comes at a health cost.  Tobacco is traditional item of India's foreign trade. India is one of the leading Tobacco exporting countries in the world. India accounts for around 5.8% of the international trade and ranks 5th after Brazil, U.S.A. Turkey and Zimbabwe. The principal market for India Tobacco is U.S.S.R, U.K, Japan and Middle East countries. 

In India, three major players dominate the market, primarily ITC with 72% market share, Godfrey Phillips with 12% and VST with 8% share of the market.

Tobacco consumption, especially in developing countries, is likely to increase because of the expanding global population and trade liberalization. There is no point in reducing production and consumption of tobacco without considering alternatives for tobacco farmers. Of course, experts expect a substantial reduction in tobacco consumption in the next fifty years or so. Around 93 percent of India’s six million tobacco farmers are small growers.

Chewing-tobacco products such as pan masala and gutkha are typical home-grown items which are unique to India and have a special set of requirements, none of which can be touched by foreign companies.

Now days pan masala has very good market demand due to customer's habit. There is a very good scope for pan masala. Basically pan masala is a substitute of tobacco products. Users of tobacco products largely converted to use Pan Masala.

The major players in India for pan masala are Dharampal Satyapal Ltd, which constitute a major share of 65% in the market, Kothari Products Ltd, with a market share of more than 11%. The other players such as Dharampal Premchand Ltd, Jagat Industries Ltd, Raghunath International Ltd, contribute the rest of the market shares.