INSTITUTE OF BUSINESS ADMINISTRATION (IBA) | SCHOOL OF BUSINESS STUDIES (SBS)

Case Study Title

Battling the Shadows: Countering Illicit Trade in Pakistan's Tobacco Industry

Company

Philip Morris Pakistan

Acknowledgments

We would like to thank everyone within the organisation who willingly shared their
knowledge and experiences with us. Their advice was helpful in creating this case study. We
also thank our academic institution for its support and encouragement as well as our
mentors and colleagues for their vital contributions.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 1

 Battling the Shadows: Countering Illicit Trade in Pakistan's Tobacco Industry

Abstract:

This case study looks deeply into the complex environment of countering illicit trafficking in the tobacco
industry, providing unique insights into approaches, challenges, and successes. We discuss inventive
strategies, regulatory compliance, and resilience crucial to maintaining market integrity by drawing on the
knowledge of an experienced industry professional. It delves into the intricate chain of actions taken by an
undisclosed tobacco business to protect its products and stop illegal trafficking. The company's dedication
to respecting industry standards and thwarting unethical behaviour is captured within this narrative.

Introduction:

In the corner office of one of Pakistan's leading tobacco product makers, Hamza Arshad sat observing the
flurry of activity that had now become characteristic for his workplace. He leaned forward in his chair,
trying to gather his thoughts but found that hard to accomplish given the cacophony around him and
instead found himself watching the constant activity in his office. The mounting threat that aflicted the
business and the Pakistani tobacco sector was being tackled by everyone. Taxes on tobacco products had
unintentionally led consumers to turn to less expensive and illegal substitutes, creating a conflict that
needed to be resolved.

The consequences were serious; each year, the company lost a startling 20-30% of its customers to a murky
market for illegal items. Despite being in a different division, Hamza's dedication to the mission drew him
into this struggle. It was recognized that Hamza has a distinct combination of skills and experience in the
field of stopping illegal commerce, making him a valuable asset in this challenging endeavor.

The campaign was led by the organization's Illicit Trade Prevention Department and External
Communications unit in tandem with all other departments, and Hamza Arshad, who worked as a Regional
Sales Manager, was essential in designing the means for tackling illicit tobacco trafficking.

Company Background

Since 1969, Philip Morris Pakistan (PMPKL), a subsidiary of Philip Morris International (PMI), has been an
important player in Pakistan's tobacco sector. The company, once known as Lakson Tobacco, has
experienced enormous transitions and has become identified with innovation, quality, and sustainability.
PMPKL, based in Karachi, swiftly established itself as a reputable manufacturer, introducing well-known
brands such as Marlboro and Parliament. The acquisition of PMI in 2007 was a watershed moment, giving
PMPKL access to worldwide resources and expertise. PMPKL has constantly raised its standards under
PMI's guidance, investing in cutting-edge technology and environmentally friendly practises. The company
has expanded its product lines to match changing consumer tastes and actively incorporates sustainability
into its primary business plan. With a workforce of over 2,000 people, PMPKL contributes considerably to
the national economy, emphasising its dedication to quality, innovation, and social responsibility.

Overview of Philip Morris Pakistan's Sales and Distribution Network

Hierarchical Sales Structure

Philip Morris Pakistan's (PMPKL) sales structure hierarchy consists of six levels, each having a distinct role in
managing and conducting sales activities. The Director Sales sits at the top of the hierarchy and is in charge

ILLICIT TRADE IN THE TOBACCO INDUSTRY 2

of developing the overall sales and distribution strategy as well as providing leadership to the whole sales
staff. Four Zonal Managers manage the sales performance of defined zones, giving strategic guidance and
oversight to Regional Sales Managers (RSMs). The 17 RSMs oversee sales activities within certain regions,
ensuring that sales targets are fulfilled and the company's products are successfully promoted and
distributed. Fifty Area Sales Managers (ASMs) manage Trade Marketing Specialists (TMS) and Sales
Representatives (SRs) and are in charge of sales activity within their designated territories. TMS implement
retail marketing objectives and strategies, whilst SRs work with retailers to promote, sell, and manage
PMPKL's product portfolio. The 72 Authorised Distributors at the bottom of the hierarchy buy products
from PMPKL warehouses and distribute them to shops in their respective regions. Furthermore, 2500 Order
Bookers are in charge of receiving orders from merchants and transferring them to the sales team for
processing and fulfilment. This extensive and well-structured sales hierarchy ensures that PMPKL's products
are effectively distributed and marketed throughout Pakistan, reaching consumers in every corner of the
country.

Strategic Distribution Network

PMPKL's distribution network assures consistent product delivery and availability across the country. The
network is made up of the following elements:

• Strategically Located Warehouses: Enable sufficient storage space for PMPKL's extensive product line.
• Authorised Distributors: These individuals buy products from PMPKL warehouses and distribute them
to merchants in their particular regions. This agreement allows PMPKL to expand its reach and gain a
deeper understanding of local market trends.
• Retailers: These individuals represent the final stage of the distribution network, selling PMPKL items
directly to consumers. Through frequent training, merchandising assistance, and promotional events,
PMPKL fosters excellent partnerships with retailers.

Sales and Distribution Optimization Strategies

PMPKL implements a combination of tactics to optimise its sales and distribution network:

• Route Planning and Optimisation: Employs route planning tools to reduce operating costs while
ensuring efficient product delivery.
• Inventory Management: Implements excellent inventory management systems in order to reduce
stockouts and maximise sales possibilities.
• Sales Incentives and Pay: Recognises and compensates sales professionals, distributors, and retailers
who surpass expectations, enhance motivation, and drive sales growth.
• Sales Training and Development: Consistently invests in sales team training and development, giving
them with the information and skills needed to effectively promote and sell PMPKL's products.
• Retailer Engagement and Support: Actively works with retailers to boost product awareness, maximise
sales potential, and strengthen customer interactions through training, merchandising, and
promotional events.
• Performance Monitoring and Evaluation: Thoroughly monitors and evaluates the performance of its
sales representatives, distributors, and retailers, identifying areas for improvement and implementing
remedial measures.
• Data-Driven Decision Making: Makes use of data analytics to acquire insights into sales patterns,
customer behaviour, and market dynamics, informing strategic decisions and optimising sales and
distribution tactics.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 3

PMPKL expertly handles the flow of its products from manufacturing to consumer consumption through its
extensive and well-structured sales and distribution network, ensuring the availability of its brands
throughout Pakistan.

Illicit Trade Affecting the Tobacco Industry in Pakistan

With so many fake and illegal goods flooding the market, Pakistan's tobacco industry faces a difficult battle
from the illegal tobacco trade.

Counterfeit cigarettes are painstakingly made to look like genuine PMI (Philip Morris International)
products, but they are produced without the brand's approval or respect to quality control requirements.
While these imitations closely resemble real products, they lack the necessary licencing and frequently fail
to fulfil the safety and quality standards enforced by the authorised brand.

Contraband cigarettes, on the other hand, are genuine PMI products that have been diverted from
authorised distribution channels. These cigarettes, which were once part of the legal supply chain, are now
being sold illegally without the payment of required taxes or customs fees. This bypassing of legal channels
costs the government a lot of money and undermines the regulated market.

The illicit trade of cigarettes has emerged as a significant challenge for the tobacco industry in Pakistan,
presenting multifaceted problems that span regulatory, public health, and economic aspects. The recent
increase in Federal Excise Duty (FED) on tobacco products, which took effect on February 14, 2023, has
caused a seismic change in Pakistan's tobacco sector. Recent evaluations undertaken by international
corporations show a dramatically different picture from earlier estimates by certain NGOs, which put the
illicit tobacco market participation at 9-18 %. Surprisingly, the contraband cigarette industry now
commands a stunning 39% market share as a result of the significant tax increase.

In Pakistan, where an estimated 17 million adults smoke, the market landscape is dominated by three
major cigarette makers, who collectively command more than 80% of the market share based on regularly
used brands.

According to SPDC data, of the legitimate market PTC controls 60.3 percent of the market, Philip Morris
International Pakistan has 22.6 percent, and Khyber Tobacco Company has 4.9 percent. The remaining
companies combined account for 12.2 percent of the market.

The Regulatory Environment

In Pakistan, the illegal sale of cigarettes is a complex problem caused by the spread of counterfeit
merchandise imitating well-known brands. This problem is worsened by an unregulated supply chain
comprised of middlemen who illegally source tobacco from fields. Despite the fact that bodies like the
Pakistan Tobacco Board (PTB) and the Excise Department have essential roles to play, loopholes in oversight
allow for the production and distribution of illicit tobacco products.

The Federal Board of Revenue (FBR) also works with the PTB, but system inadequacies allow more than
criminal commerce to thrive, with a shocking 30% of the entire business being unregistered. Recent acts,
such as the Supreme Court's decision to overturn Tobacco Control regulations, exacerbate the problem.
The exorbitant 74% duty on cigarettes creates an enticing environment for local manufacturing and tax

ILLICIT TRADE IN THE TOBACCO INDUSTRY 4

evasion, resulting in higher packaging prices due to high taxation but actual retail sales at significantly lower
prices—a clear indicator of tax avoidance and the thriving illicit market.

Aside from the obvious economic consequences, regulatory infractions aggravate the problem. Over 100
brands of contraband have flooded the market without complying with the Ministry of Health's statutory
health warnings. These products openly defy Pakistani laws, selling without regard for official rules and
operating with impunity, avoiding sanctions.

FED and the growth of the illicit market:

The government implemented its most significant excise tax increase for the tobacco industry in February.
The Federal Excise Duty (FED) on tier-1 brands was increased by 153.8 percent to Rs16,500 per thousand
cigarettes, while the duty on tier-2 brands was increased by 146.3 percent to Rs5,050 per thousand
cigarettes.

Following an increase from 29% to up to 55% in FED by February 2023, the market share of legal cigarettes
dropped from 60% to 30%. Because of the FED, sales have fallen, as has a vital source of revenue for the
government. Consequently not only revenues for the firm have decreased in recent years but the total tax
paid by the firm to the Federal Government has also decreased.

Rampant Smuggling:

The startling growth in illicit trade follows recent hike in Federal Excise Duty (FED) on tobacco products in
January 2022. Despite the presence of reputable players such as PTC, Philip Morris, and Khyber Tobacco
Company, their combined market share remains limited at 37%. Surprisingly, smuggled cigarettes now
account for 13% of the market, while non-taxed locally manufactured cigarettes account for 50.2 percent.

Regardless of the objectives behind the excise duty increase, it unwittingly jeopardized the industry's
survival. The burgeoning black market is eroding legitimate market share. Locally produced dual-flavor
cigarettes are priced at Rs650, whereas comparable quality cigarettes from Dubai flood the market at a
fraction of the cost, roughly Rs150 per packet.

Market Dynamics and Revenue Consequences

The most concerning revelation is the dramatic shift in sales quantities between the legal and illegal
sectors. In March 2023, legitimate industry sales fell from 4.84 billion sticks in January 2023 (pre-mini
budget) to 1.84 billion sticks. During the same time span, the illicit industry had an exponential increase
from 2.85 billion sticks to 4.8 billion sticks. This abrupt transition of 3 billion sticks from the official to the
illicit sector has a significant impact on government revenue, providing a difficult fiscal position.

Cigarette producers have expressed concern about the major impact of the tax rise on their sales,
attributing the reduction to financial restrictions experienced by smokers, prompting them to investigate
alternative goods, some of which are offered duty-free.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 5

Throughout March and April of 2023, Philip Morris (Pakistan) reported a 70 percent drop in sales and a
stunning 60 percent drop in manufacturing volume. The company voiced concern in a statement posted on
Monday that this declining trend will continue, owing mostly to an increase in contraband cigarettes.

PTC, a major competitor to Philip Morris Pakistan, expressed similar thoughts, adding that while overall
cigarette use in the country remained stable, economic challenges have hampered the purchase of
legitimate cigarette brands, forcing customers to turn to illicit alternatives. The company emphasized that
these illicit brands retail for less than the government-mandated Minimum Legal Price (Rs127.4), which is
contributing to the illicit sector growing to 43 percent of the whole industry from roughly 37 percent in
January 2023.

Economic Implications of Taxation on Tobacco Products:

Following the heightened FED, the market saw an infusion of roughly 70 new brands of contraband
cigarettes. The availability of these unlawful products at significantly reduced pricing has enticed price-
conscious consumers to seek out these less expensive alternatives, resulting in a 30% increase in sales in
March alone.

The looming spectre of illicit commerce looms big, wreaking havoc on Pakistan's economic environment.
The national exchequer loses a staggering Rs. 240 billion each year as a result of this shadowy sector. The
government's proactive position, using high tobacco costs to discourage smoking, exemplifies a laudable
public health programme. This year's anticipated increase in cigarette taxes of Rs. 60 billion highlights the
potential for revenue recovery with strict enforcement.

It is worth mentioning that PMI and BAT contribute to 98% of taxes while other illegal companies
contribute to just 2%. This calls into question the government’s policy of only imposing taxes to protect
public health, while other avenues could potentially prove more useful.

The unintended repercussions, on the other hand, weave a complex tapestry. Despite increased taxation
and health initiatives, the legitimate tobacco sector is seeing an unexpected drop. Tax evasion by a variety
of products upsets expected fiscal advantages, needing rapid action to negotiate this sophisticated web of
obstacles.

This linked conundrum necessitates nuanced measures for striking a balance between reducing illicit
commerce, maintaining budgetary stability, and protecting public health.

Public Health Concerns:

Because of enormous tax evasion, the number of enterprises paying to tax reserves is quite insufficient,
leaving any government efforts to use cigarette taxes for public health funding null and worthless. Because
cigarettes frequently dodge quality control measures, customers may face health concerns. The lack of
governmental oversight in the manufacturing and distribution of these commodities raises questions about
the quality and safety of the tobacco ingested, which may be harmful to public health.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 6

Track and trace systems have been implemented in an effort to monitor and regulate the transit of tobacco
products. However, the track and trace system reduced illegal tobacco trade to 15%; the efficacy of such
systems may require further investigation.

The continuation of the illicit cigarette trade is aided by a lack of efficient enforcement, the development of
new smuggled brands, and the failure of the track and trace system. To address the economic losses,
regulatory barriers, and public health hazards, a comprehensive solution that includes more stringent
enforcement, improved border control, and enhanced public awareness is required.

Tackling Illicit trade at Philip Morris Pakistan:

As the company dealt with the implications of the growing illegal tobacco trade, Hamza Arshad, a dedicated
employee at the heart of the company's operations, found himself in a position that demanded both
innovation and endurance.

After painstakingly assessing the known facts and data on the matter (as previously described), Hamza
initiated a comprehensive outreach campaign. His first step was to consult with all relevant departments
inside the firm to gather their perspectives on the current issue. He actively sought out other stakeholders
outside of the company, encouraging discussions with industry experts and community representatives.
Hamza thought that by immersing himself in these debates, he would be able to delve further into the
nuances of the matter, gaining important insights from both internal and external viewpoints.

With these facts in hand, Hamza advocated for a multi-tiered approach within the business. He launched a
campaign with local authorities and community leaders to raise awareness about the hazards and
consequences of supporting the illicit tobacco market. His remarkable communication skills and genuine
empathy struck a chord, forming important connections.
However, the journey was not without its difficulties. Internal opposition arose, with some viewing the
problem as insurmountable. Undaunted, he scheduled brainstorming sessions to encourage cross-
departmental collaboration. Several novel suggestions for dealing with the situation surfaced, drawing on
diverse perspectives.

Distributor Selection, Training and Monitoring

The implementation of a strict distributor selection process was one such technique that emerged as a
result of Hamza's investigation efforts. This method focused on developing a thorough due diligence
procedure that evaluated potential distributors' financial soundness, compliance history, and ethical
business practises. The corporation wants to favour distributors with a proven track record of adhering to
legal frameworks governing tobacco sales and distribution, highlighting a commitment to legality.

Hamza found himself navigating a slew of measures aimed at bolstering the integrity of PMI's distribution
channels and countering illicit trading in the tobacco supply chain. It was suggested that a regime of
constant monitoring and audits be implemented across distributor operations to ensure strict adherence to
authorised routes and bolster compliance with anti-illicit trade protocols. Transparency and robust
communication channels were critical components in addressing difficulties and collectively driving
effective anti-illicit trade activities.

As part of this broader approach, precise distributor selection criteria and stringent channel regulations
were recommended. These policies would specify appropriate sales practises, means of engaging with
merchants, and reporting mechanisms for suspicious activity. Compliance training for distributors,
educating them on anti-illicit trade legislation, identifying illicit products, and efficient reporting systems,
was critical to the effectiveness of these rigorous regulations.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 7

Track and Trace Technology
The possibility of using the Track and Trace technologies provided by the Federal Board of Revenue (FBR)
was discussed as a viable option. These systems tracked product flow with technology, ensuring
authenticity within authorised routes. Along with these activities, a centralised reporting system was
proposed as a way to quickly and efficiently report any suspected illegal trade activity. Furthermore, to
promote compliance, ideas included a tiered system of sanctions for non-compliant distributors, ranging
from warnings and fines to the eventual suspension or termination of distributor relationships,
emphasising the company's commitment to channel integrity and legality. Furthermore, the anticipated
technology enhancements for channel control were intended to strengthen the distribution network. These
technical solutions held the promise of improving the distribution network's integrity by setting distributor
standards, enforcing compliance training, and deploying reporting systems.

The planned use of technology for channel management was a critical component of PMI's fight against
illicit trade in the tobacco supply chain. This strategic implementation entailed using technology tools and
solutions to track, trace, and regulate product movement from manufacturing hubs to retail terminals. The
major goal was to protect the exclusive distribution of real items through authorised channels while
limiting counterfeit goods infiltration. The adoption of track-and-trace technology, which assigns unique
identities to products and allows for extensive monitoring from manufacturing lines to customer
transactions, was central to this concept. This technology, if implemented, would allow for real-time
monitoring of product movements, detection of unauthorised diversions, and checks at different supply
chain points, ensuring consumer access to authentic PMI products.

Data Analytics Tools

Furthermore, the use of data analytics tools emerged as an additional asset to track-and-trace systems. PMI
could detect abnormalities and predict probable illicit trade activities by analysing sales data and
distribution patterns, enabling proactive interventions and improving channel security.
Using technology for channel control provided several benefits. It offered increased accountability, real-
time visibility, and the ability to quickly identify illegal commerce, allowing for prompt interventions and
stopping the spread of contraband. More importantly, technological insights enabled data-driven decision-
making, optimising channel management, and bolstering anti-illicit trade efforts.

Advocates for this technique emphasised the power of data analytics in detecting anomalies in sales data,
allowing for prompt interventions, and anticipating areas prone to unlawful trade practises. Direct
involvement with customers and retailers through digital platforms has arisen as a method for education,
raising awareness about counterfeit risks, and enabling rapid reporting pathways for suspected unlawful
trade situations. Strong CRM systems were recommended to painstakingly monitor distribution networks,
assuring adherence to authorised paths while also offering merchants with tailored support. This
comprehensive approach held the promise of empowering PMI to combat illicit trading, strengthen brand
integrity, and contribute to a more ethical tobacco market.

Anti-Illicit Trade Monitoring Team

Exploring various anti-illicit trade techniques, one significant proposal argued for the establishment of a
specialised anti-illicit trade team within PMI Pakistanistan's sales force. This specialised unit of specialists
aims to convey information about the complexity of illicit trade while actively probing suspected activities
and developing strong connections with law enforcement for legal interventions.

Incorporation of Anti-Illicit Trade Indicators into Salesforce Compensation Plans

Furthermore, Hamza's analysis yielded an important conclusion, suggesting that anti-illicit trade indicators
be integrated into sales representative performance evaluations. This plan emphasised the need of

ILLICIT TRADE IN THE TOBACCO INDUSTRY 8

preventing illegal trade by encouraging proactive detection, reporting, and cooperating with law
enforcement, emphasising the sales force's critical position within these requirements.

Integrating anti-illicit trade indicators into sales representative evaluations will not only strengthen, but also
elevate the significance of anti-illicit trade measures within the purview of individual sales roles. This
includes documenting reported incidents, incentivizing proactive identification of illegal actions,
recognising contributions to education and awareness efforts, and fostering collaboration with law
enforcement authorities. This kind of integration emphasises the sales force's commitment to combating
unlawful trade as a top priority.

Hamza's inquiries yielded some concrete recommendations that altered PMI Pakistanistan's position
against illegal trading. Integrating anti-illicit trade data into distributor Return on Investment (ROI)
calculations was a significant concept. Traditionally, ROI measurements were primarily focused on sales;
however, integrating criteria such as seized instances, educational programmes, and adherence to anti-illicit
trade regulations will reward distributors actively engaged in reducing illicit market shares, emphasising
PMI Pakistanistan's anti-illicit trade commitment.

He also stressed the importance of tiered incentive and penalty schemes for distributors. High-performing
distributors may benefit from increased profits or exclusive sales rights, but noncompliance may result in
lower margins or contract termination. This strategic alignment of distributor incentives with PMI
Pakistanistan's anti-illicit trade goals was intended to inspire greater collaboration.

Hamza emphasised the proactive role that distributors are expected to play, which includes training
employees, conducting audits, establishing clear reporting protocols, coordinating with law enforcement,
and educating shops on how to spot illegal products. Active participation in PMI Pakistanistan's training
programmes, as well as timely exchange of information on sales activity and suspected unlawful
circumstances, could considerably boost anti-illicit trade activities.

Monitoring Sales Data to flag Illicit Trade

Furthermore, Hamza emphasised the significance of maintaining ongoing awareness within distributor
networks. Monitoring sales patterns, inventory discrepancies, and unauthorised distribution methods
would raise possible red flags, alerting authorities to potential illegal trade operations in real time.

Sales Forecasting & Planning

Sales forecasting and planning, usually a sales technique, has evolved into a proactive defence mechanism
in PMI Pakistanistan's fight against illegal commerce. Hamza called for the inclusion of illicit trade variables
in sales estimates, which would allow for an assessment of the prevalence of unlawful trade in various
market sectors and geographies. This insightful technique allows sales forecasts to be adjusted to account
for the possible impact of illicit trade on genuine product sales, allowing for more accurate resource
allocation and planning.

Contingency Planning
Hamza emphasised the importance of reacting to illegal trade interruptions and the need for contingency
preparations. Identifying alternative supply pathways, adapting marketing strategies to changing customer
behaviours influenced by illegal trade, and maintaining flexible sales targets that respond dynamically to
illicit trade challenges, ensuring continuous market presence and effective resource utilisation despite such
interruptions are all examples.

Market Research
In his comprehensive approach, Hamza stressed the importance of conducting market research in order to
adequately track illicit trade trends. He underlined that continuous study could provide vital insights into
ILLICIT TRADE IN THE TOBACCO INDUSTRY 9
future threats as well as the efficiency of anti-illicit trade efforts. To maximise its potential, PMI
Pakistanistan should undertake the following:

• Identify potential threats to PMI Pakistanistan's market share, such as new illicit trade methods,
counterfeit items, or expanding distribution channels.

• Evaluate the efficacy of ongoing anti-illicit trade activities, identify areas for improvement, and allocate
resources effectively to maximum effectiveness.

• Modify sales strategies to address emerging dangers, focusing efforts in areas with high illicit trade
activity and focusing on consumer segments most vulnerable to illicit items. This adaptable strategy
would enable the organisation to overcome evolving challenges and maintain market resilience in the
face of illicit trade disruptions.

Aligning Sales Techniques with Elimination of Illicit Trade

Hamza, a key member in PMI’s sales section, was committed to aligning sales methods with the ultimate
goal of eliminating illicit trafficking. His strategic endeavour entailed seamlessly integrating anti-illicit trade
measures into the sales operation, a cornerstone in PMI Pakistanistan's commitment to brand integrity.
This comprehensive approach included a number of critical factors aimed at combating illegal commerce.

The seamless integration of anti-illicit trade measures into sales methods was central to Hamza's
methodology. He emphasised the importance of sales in countering illicit trade, arguing for anti-illicit trade
measures to be included in sales targets, performance evaluations, and training programmes. Hamza
established a watchful approach to identifying and resolving areas for improvement within the sales
function by closely monitoring important illicit trade metrics such as seizure rates and regulatory
compliance.

Collaboration with External Stakeholders

Collaboration was a critical component of Hamza's plan. He wanted to form alliances with peers in the
sector, government agencies, and civil society organisations in order to establish a united front against
illegal commerce. Hamza envisioned coordinated activities, educational campaigns, and lobbying efforts to
combat illicit trade through these proposed alliances, emphasising the collective responsibility shared by all
players in this endeavour.

AI and Blockchain
Investment on anti-illicit trade measures reflected Hamza's foresight. He advocated for specific funding as
well as the use of cutting-edge data analytics technologies to identify hotspots and assess the performance
of ongoing activities. A crucial feature discussed was the use of future technologies like as AI and
blockchain, which might potentially increase detection and prevention systems.

Transparency in the Sales Function

Another essential aspect of Hamza's plan was to promote transparency and accountability in the sales
realm. He emphasised the importance of strong policy frameworks, open communication channels, and
centralised reporting systems for responding quickly to suspected illicit trade operations. This proposed
transparency culture allowed for a proactive response to prevent illicit transactions within the organisation.

Regulation of GLT Units

However, as previously stated, the final proposed solution emphasised the necessity for improved
monitoring and regulation of Green Leaf Threshing (GLTs) production in order to reduce the fabrication of
counterfeit tobacco products and illegal trading within Pakistan. This recommended action called for

ILLICIT TRADE IN THE TOBACCO INDUSTRY 10

coordinated measures to eliminate corruption within regulatory authorities including the Federal Board of
Revenue (FBR) and the Pakistan Tobacco Board (PTB) in order to improve monitoring and prevent the
production of illegal tobacco goods. These unlawful items are frequently derived from otherwise lawfully
registered manufacturing facilities, with the end product dodging taxation and legality. The tobacco used in
the procedure is sourced directly from traders in Pakistan's largest tobacco-growing region, Swabi in KPK
province. Notably, several of these unlawful brands are purportedly related to powerful persons in both
provincial and national legislatures, potentially allowing them to avoid the rule of [Link], the proposed
solution aims to address the issue at its base by addressing corruption, monitoring production, and
controlling the supply chain in order to prevent the creation and sale of illegal tobacco products. The
implementation process was a rollercoaster ride with ups and downs. Hamza’s perseverance in lobbying for
change was crucial. The rewards of their labour began to surface gradually, as seen by the fall of unlawful
items in important marketplaces and the restoration of customer trust.

Hamza's story exemplifies the power of dedication and ingenuity in overcoming industry-wide problems.
His persistent dedication to change not only influenced the company's destiny, but it also developed a
culture of resilience and adaptation.

Obstacles to Implementation of Solutions:

Legal tobacco companies that pay taxes, like Philip Morris International, struggle with a number of issues
brought on by illegal trafficking. The influx of illicitly made and smuggled tobacco products, which are
sometimes marketed at reduced costs, present a serious risk to their market share and earnings.

Despite initiatives such as advocating for equal taxation systems, consumer awareness campaigns
emphasizing the dangers of illicit items, and developing international cooperation, persistent obstacles
exist. These obstacles include adapting to changing regulations, handling complex cross-border concerns,
and the need for strong business lobbying and engagement with varied stakeholders to tackle the
ubiquitous issue of illicit tobacco trade.

One particular difficulty they face is the participation of certain local actors in the entire illegal trade
process, where political ties are maintained by certain unregulated tobacco corporations. They are able to
trade illegal goods in the market with ease as a result. The fact that retailers are not as aware of this makes
it more harmful. Because these businesses package unlawfully trafficked goods in local packaging and offer
them as Pakistani cigarettes or as cheap imitations of more expensive foreign cigarette brands, it benefits
the entire ecology of illicit trade. Their nonpayment of taxes has an impact on the number of legal entities,
particularly in remote locations such as districts in KPK, etc. It is worth repeating that PMI and BAT
contribute 98% of taxes, while other enterprises give only 2%.

PMI and other players have been collaborating to raise this issue at the government level, put sanctions on
illicit channels, as well as use resources to help authorities confiscate illicit stock, and raid illegal
factories/warehouses. However, since this is a grey channel, their stock is still available for retail and sales
continue. Pakistan has also implemented a Trace and Track System (TTS) to monitor sugar, tobacco, and
fertilizer sectors. There are calls to implement TTS across all cigarette manufacturing facilities, especially in
Khyber Pakhtunkhwa, where most illegal companies manufacture. However, the TTS system was suspended
by Lahore High Court on July 22, 2021 – a mere 21 days after its introduction based on charges of the
potential of violation of consumer privacy. The system remains suspended as yet, but it is hoped that it will
be re-activated by the relevant judicial-legislative bodies soon.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 11

Other strategies have been proposed, such as urging the government to implement trace and track systems
across the board, and most importantly, better border control. Other avenues to curb illicit sales include
strengthening enforcement, and advance tax collection at threshing level.

An Uncertain Future Ahead

Hamza, who is one of those in charge of implementing anti-illicit trade tactics at PMI Pakistan, faced a
difficult issue. The plethora of viable techniques, ranging from data-driven sales optimisation to utilising
digital platforms for customer education, confounds him as to where to begin. Implementing these
techniques entails overcoming a number of obstacles, including prioritising efforts, overcoming potential
resistance to change, and finding the best sequencing of implementation processes.

Prioritisation is the major concern. Choosing which techniques to implement first necessitates a full
understanding of their potential impact, viability, and alignment with current sales processes. Hamza faces
the issue of deciding between methods that require immediate action and those that promise long-term
rewards, attempting to strike a balance between short-term gains and long-term, meaningful projects.

Furthermore, the execution of these techniques involves difficulties such as resource allocation, training
requirements, and sales approach recalibration. Each initiative need customised implementation strategies,
demanding a complete execution roadmap. The difficulties in involving retailers, wholesalers, and
consumers in anti-illicit trade measures complicate the implementation process even more. Furthermore,
projecting the timing for these implementations is difficult. Each initiative necessitates time and resources,
from technology investments to partnership building and instructional [Link] was tasked with
calculating the time required for planning, implementation, and obtaining measurable results while taking
into account the interplay of multiple methods.

Finally, Hamza's quandary rested not just in determining the most effective tactics, but also in developing a
logical, phased execution strategy. Addressing these problems necessitates a methodical approach to
strategizing, executing, and measuring the performance of each project within a flexible framework. As
Hamza navigates this decision-making process, analysing potential roadblocks and developing an
implementation plan will be critical for PMI Pakistan's anti-illicit trade efforts to be successful.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 12

 Teaching Note
Case Title:

Battling the Shadows: Countering Illicit Trade in Pakistan's Tobacco Industry

Case Synopsis:

The case study goes into the complex challenges of eliminating the illicit cigarette trade in Pakistan,
focusing on Philip Morris International (PMI) Pakistan's aggressive initiatives. In an environment where the
illicit cigarette industry thrives and accounts for a sizable market share, PMI Pakistan faces the difficult task
of protecting its legitimate operations while addressing the widespread issue of counterfeit and contraband
tobacco products.

Counterfeit cigarettes are painstakingly crafted to resemble genuine PMI (Philip Morris International)
goods, but they are manufactured without the brand's consent or adherence to quality control standards.
Contraband cigarettes, on the other hand, are genuine PMI products hijacked from licensed distribution
channels. These cigarettes, which were once legal, are now being sold illegally without the payment of
essential taxes or customs fees. This circumvention of authorized channels is costly to the government and
undermines the regulated market.

With the introduction of an exorbitant FED, PMI’s cigarettes became unaffordable for consumers, prompting
illegal brands to flood the market. The legal industry which previously took 70% of market share has suffered
major revenue losses and stands at a mere 30% market share as of November 2023.

At the heart of the case study, PMI Pakistan wrestles with a slew of potential solutions to curb illicit
cigarette trade. The protagonist is faced with a difficult decision-making scenario in which he must weigh
the benefits, drawbacks, and repercussions of each proposed option. As the story progresses, the
protagonist finds himself at a crossroads, faced with the arduous process of decision-making.

The case study delves into PMI Pakistan's Sales Department's strategic measures to address this serious
issue. It dives into the comprehensive actions conducted across different aspects, such as Sales Channels
Management, Sales Force Design, Sales Management & Technology, Sales Forecasting & Planning,
Performance Management, and Sales Strategy Formulation.

While the tobacco industry has long been working with the govt to curb illicit trade and increase tax
reduction, Hamza has come up with initiatives to tackle the significant loss of revenue due to current FED
hike. Few Initiatives discussed in the case include but are not limited to, working with the government and
FBR to implement strong policy frameworks and use technology for better tracking of goods and a central
reporting system for prompt suspension of illicit activities. Another major strategy proposed is tackling the
issue at its root and enforce improved regulation of Green Leaf Threshing (GLT) to tackle manufacturing of
illegal tobacco products in Pakistan.

The ending of the case study portrays the protagonist's dilemma in selecting, prioritizing, and garnering
support for the proposed actions. The storyline underscores the protagonist's crucial role in navigating this
intricate landscape, emphasizing the need for a carefully crafted decision-making process. The case
concludes on an open note, highlighting the protagonist's strategic prowess and leadership acumen in

ILLICIT TRADE IN THE TOBACCO INDUSTRY 13

steering PMI Pakistan's efforts towards effectively combating illicit cigarette trade while considering
resource constraints, stakeholder perspectives, and organizational objectives.

The case study intends to provide significant insights into the problems and triumphs experienced in the
battle against illicit cigarette trade through an in-depth review of PMI Pakistan's actions. It emphasises the
importance of a multifaceted strategy combined with creative techniques to protect the integrity of the
tobacco industry while prioritising public health and regulatory compliance in Pakistan's market scenario.

Teaching Objectives:

This case study was written for an undergraduate sales management course, it examines a variety of cross-
functional topics, including Sales Channels Management, Sales Force Design, Sales Management &
Technology, Sales Forecasting & Planning, Performance Management, and Sales Strategy Formulation. The
case study's primary objective is to give students a comprehensive understanding of the multifaceted
challenges inherent in countering illicit trafficking within Pakistan’s tobacco industry. The case aims to
foster critical thinking and analytical skills among students by delving into the intricacies of illicit trade,
distinguishing between counterfeit and contraband products, and elucidating the economic, regulatory, and
public health repercussions of Illicit trade. Moreover, Students will explore the strategic approaches taken
by a tobacco company to address the surge in illicit trade. The goal of the case study is to clarify the
significance of innovative approaches, such as the incorporation of data analytics and Track and Trace
systems, together with the critical role that salespeople play in combating illicit trade. Students will learn
about the difficulties that legal tobacco companies have while working with different stakeholders, which
will help them understand the complexities of this industry. Furthermore, the case study also aims to
encourage discussions about future strategies and the importance of continual adaptation in the face of a
constantly changing illicit trade environment.

Immediate Issues:

1. Intervention Prioritization: Choosing which of the recommended activities to prioritize in fighting illicit
trade while taking resource limits and possible impact into account.

2. Key Decision Alternatives being pondered:

• Identify and Partner with Reliable Distributors: Establishing a comprehensive distributor selection
process, prioritizing track records of legal compliance, instituting continuing monitoring and audits,
and fostering open communication and collaboration with distributors are all part of identifying and
partnering with reliable distributors.
• Enforce Strict Channel Regulations: Creating explicit channel rules, requiring compliance training for
distributors, implementing track-and-trace technologies, establishing a centralised reporting system,
and instituting tiered punishments for noncompliance.
• Use Technology to Control the Channel: Track-and-trace technology is used to monitor product
movement, identify diversion, and verify authenticity. In addition, data analytics technologies are
being used to detect anomalies, predict illicit trade patterns, and optimise channel management.
• Sales Force Design: Entails establishing a dedicated anti-illegal trade team, including anti-illicit trade
measurements into sales metrics, arming the sales force with technology, and assuring their active
participation in countering illicit trade.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 14

 • Sales Management and Technology: Using data analytics, utilising technology for customer
engagement, deploying CRM systems for improved channel control, and ensuring that technology
supports in the fight against illegal trade activities.
• Distributor Compensation Plans: Aligning incentives with anti-illicit trade initiatives by measuring
distributor performance against anti-illicit trade criteria, monitoring distributor networks for illicit
trade activity, and holding distributors accountable for compliance.

3. Resource Allocation: Allocating enough financial as well as human resources to successfully support the
chosen actions.

4. Technology Integration: Evaluating the feasibility and effectiveness of integrating sophisticated

technology for tracking and reporting suspicious illicit trade activity.

5. Ethical Consequences: Addressing ethical concerns and potential hazards connected with chosen tactics,
as well as assuring alignment with business values and regulatory compliance.

6. Measuring Effectiveness: Developing metrics and frameworks for assessing the efficacy of deployed
treatments and modifying methods in real time depending on feedback.

7. Navigating the Regulatory environment: Ensuring compliance with existing legislation and navigating the
ever-changing legal environment of tobacco sales and distribution.

8. Long-term Strategy: Developing a long-term strategy to combat illicit trade, with a focus on sustainability
and adaptation to changing market circumstances.

Basic Issues:

This case study offers useful insights into the real-world issues that multinational firms encounter in regulated
industries. Exploring PMI Pakistan's activities sparks crucial discussions on market dynamics, technology, and
ethics, among other topics:

1. Real-World Relevance: The case tackles a critical real-world issue confronting multinational firms
operating in highly regulated industries, providing students with a practical grasp of strategic decision-
making in countering illicit trade.

2. Strategic Decision-Making: The case presents a difficult decision-making scenario that requires
students to critically analyse and prioritise several strategic actions offered by PMI Pakistan's Sales
Department to combat illicit trade, strengthening analytical thinking and strategic acumen.

3. Multi-Dimensional Approach: It covers a wide range of topics such as sales techniques, technology
integration, regulatory compliance, stakeholder collaboration, and ethical issues, giving students a
comprehensive understanding of countering illicit trade.

4. Industry-Specific Context: It goes into the issues of the tobacco industry, shedding insight on the
intricacies of navigating regulatory regimes, market dynamics, and ethical quandaries that companies
like PMI Pakistan face.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 15

 5. Ethical Business Practices: Encourages debates on responsible business behaviour and ethical
decision-making by engaging students in conversations on ethical considerations within industries
experiencing regulatory challenges.

6. Practical Application of Business Concepts: Encourages students to use theoretical business concepts
in real-world scenarios such as market analysis, decision-making frameworks, technology integration,
and stakeholder management.

7. Stimulates Critical Thinking: Encourages critical thinking by giving an open-ended conclusion and
encouraging students to assess and defend their choices, examine trade-offs, and foresee probable
repercussions of chosen techniques.

8. Interactive Learning: Encourages interactive conversations and group debates, allowing students to
participate in role-playing exercises or team-based analyses to discover concrete answers to the case's
issues.

The case study provides a rich learning experience by including students in strategic decision-making,
ethical concerns, and industry-specific difficulties, so creating a solid foundation for a full and immersive
learning experience.

Suggested Student Assignment

1. What do you think are the most important contributors preventing the elimination of illicit cigarette
trade in Pakistan?
2. How should companies like PMI tackle systemic issues they face in an economic environment such as
Pakistan?
3. With regard to tackling illicit trade, students can be encouraged to ponder on key thematic questions
as follow:

• Management of Sales Channels: How should Philip Morris Pakistan optimize its sales channels to
prevent the entrance of illegal cigarettes?

• Salesforce Design: What specific duties or responsibilities should a sales force design include in order
to effectively combat illicit trade?

• Sales Management & Technology: How might technology integration aid in the monitoring and
control of illicit product sales?

• Distributor ROI Calculations: What criteria or performance indicators would you recommend
including in distributor ROI calculations to combat illicit trade?

• Sales Forecasting and Planning: How can Philip Morris Pakistan account for the impact of illegal trade
in its sales estimates and contingency plans?

• Sales plan Development: What areas should be prioritised in Philip Morris Pakistan's sales plan to
combat illicit cigarette trade?

ILLICIT TRADE IN THE TOBACCO INDUSTRY 16

Answers:

1. This question tests students’ retention, encouraging them to present relevant information in a concise
manner. A good answer would include problems like systemic issues of unregulated markets, supply chain
shortcomings leading to contraband, and people with political influence vetoing government initiatives
to curb illicit tobacco trade.
2. This question tests students’ analytical skills, prompting them to analysis the initiatives and come up with
their own suggestions.
3. Answers to these questions can take several forms but should more or less adhere to the following
constructs:

• Sales Channel Management: Philip Morris Pakistan might optimise sales channels by screening and
selecting distributors who are committed to ethical and legal practises.

• Sales Force Design: Within the sales force, establish a specialised anti-illicit trade team comprised of
trained professionals with expertise in identifying and combating illicit trade.

• Sales Management & Technology: Using technology such as track-and-trace systems and data
analytics to monitor goods movements and find anomalies that indicate illegal trade.

• Distributor ROI Calculations: Include measures such as events avoided, consumer education
initiatives, and regulatory conformance in distributor ROI calculations.

• Sales Forecasting and Planning: Create sales estimates that take into account the projected impact of
illicit trade, as well as contingency measures to alleviate potential interruptions.

• Sales Strategy Development: Prioritise the seamless integration of anti-illicit trade measures into sales
plans, encouraging compliance and providing knowledge and resources to the sales force.

Case Analysis
Exhibit 9: PMIPKL – Trend Analysis shows PMIs profit and loss statement over the last few years to give a
clear picture of increase in taxation. PMI has enjoyed a steady growth of 5-10% each year but suffered an
11% loss in its revenue for the half-year ended 2023. Taxation rose from 28% in 2021 to 55% in 2023, an
exorbitant increase. Not only has this negatively impacted PMI’s profit margins significantly, but the total
tax also generated has decreased from 1,252,306 PKR in 2022 to 459,913 PKR in 2023. This is because
consumers have shifted to contraband of illicit brands, so both the government and PMI are both losing
revenue by increasing taxes on [Link] the introduction of an exorbitant FED, PMI’s cigarettes
became unaffordable for consumers, prompting illegal brands to flood the market. The legal industry which
previously took 70% of market share has suffered major revenue losses and stands at a mere 30% market
share as of November 2023. While the tobacco industry has long been working with the govt to curb illicit
trade and increase tax reduction, the case protagonist,Hamza, comes up with initiatives to tackle the
significant loss of revenue due to current FED hike. Initiatives include but are not limited to, working with
the government and FBR to implement strong policy frameworks and use technology for better tracking of
goods and a central reporting system for prompt suspension of illicit activities. Another major strategy
proposed is tackling the issue at its root and enforce improved regulation of Green Leaf Threshing (GLT) to
tackle manufacturing of illegal tobacco products in Pakistan.

ILLICIT TRADE IN THE TOBACCO INDUSTRY 17

 Appendix
Exhibit 1: PMI’s Blog on Countering Illicit Trade
Why is confronting illicit trade key to delivering a smoke-free future?

The world has an unprecedented opportunity to eradicate smoking. Science and technology have
enabled the development of better alternatives for adults who would otherwise continue to smoke,
moving a smoke-free future to within our grasp.

To deliver a smoke-free future, we must ensure that there are no illegal actors sustaining a black
market for cigarettes and other tobacco products. Cigarettes, for instance, remain one of the most
common illegally traded goods in the world, with as much as 12 percent of total cigarette sales
(excl. China) sourced from the black market.
READ MORE
Smoke-free products can be a much better choice for adult smokers than continuing to smoke, so it
is also paramount to protect consumers from fakes and prevent the smuggling and counterfeiting
of our products.

Securing our supply chain

For PMI, eliminating the illicit tobacco trade has been a long-standing priority. We focus our efforts
on securing our supply chain and protecting our products. And we do it by leveraging technology
and innovation for the better: From multiple applications of authentication and security
technologies to track and trace our products across the supply chain, to the use of machine
learning to identify and prevent illegal online sales, technology is helping us detect and address
illicit trade.

But if we truly want to have an impact on deterring illicit tobacco flows, and protect consumers and
our brands from smugglers and counterfeiters, our internal efforts need to be coupled with strong
cross-sectoral collaboration and partnerships.

A holistic approach for a successful collaboration

ILLICIT TRADE IN THE TOBACCO INDUSTRY 18

No one can fight illicit trade on their own. Public-private partnerships based on an inclusive,
commonsense approach by governments, the private sector, and civil society are vital to helping
combat the practice.

This is why we set up PMI IMPACT, a major initiative to fund projects around the world to address
and tackle illicit trade. PMI IMPACT fosters cross-sector and public-private collaboration, as it
supports a wide range of organizations that fight illegal trade through research, awareness-raising,
developing technical solutions, funding equipment, and training and communication initiatives.
In today’s hyper-connected world—with growing concerns around global security, the proliferation
of criminal organizations, and the surge of new digital tools—we believe that it’s more important
than ever to sustain our collective efforts and promote an inclusive dialogue around solutions to
tackle this global issue.

To deliver a smoke-free future, it is imperative to eradicate illicit trade wherever it exists.

Source: Philip Morris Website
(Investor Information, n.d.)

Exhibit 2: Tobacco Atlas: Country Factsheet - Pakistan

Source: Tobacco Atlas – Country Factsheet of Pakistan

ILLICIT TRADE IN THE TOBACCO INDUSTRY 19

Exhibit 3: Philip Morris Pakistan – Sales Structure

ILLICIT TRADE IN THE TOBACCO INDUSTRY 20

Source: Philip Morris Pakistan
Exhibit 4: Illegal Trade: Country Factsheet - Pakistan

Source: [Link]

Exhibit 5: Illegal Trade: Country Factsheet - Pakistan

Source: [Link]

Exhibit 6: PM Khan’s Speech on Completion of 100 Days in Office

Source: Dunya News

ILLICIT TRADE IN THE TOBACCO INDUSTRY 21

Exhibit 7: Cigarette Consumption and applicable FED rates.

Source: [Link]

Exhibit 8: Illicit Trade Analysis – Problem Root Cause Analysis.

Source: [Link]

ILLICIT TRADE IN THE TOBACCO INDUSTRY 22

Exhibit 9: PMIPKL – Trend Analysis
PHILIP MORRIS (PAKISTAN) LIMITED YOY Analysis
INTERIM STATEMENT OF PROFIT OR LOSS
FOR THE SIX MONTHS PERIOD ENDED
30-Jun-23 30-Jun-22 30-Jun-21 30-Jun-20 2023/2022 2022/2021 2021/2020
(Rupees in thousands)
Turnover - net 9,059,594 10,165,998 9,224,025 8,806,270 89% 110% 105%
Cost of sales 5,677,790 5,517,238 4,763,039 5,177,656 103% 116% 92%
Gross profit 3,381,804 4,648,760 4,460,986 3,628,614 73% 104% 123%

Distribution and marketing expenses 1,762,013 1,368,300 1,431,928 953,487 129% 96% 150%
Administrative expenses 825,922 636,106 734,140 772,346 130% 87% 95%
Other expenses 992,061 458,655 265,362 249,203 216% 173% 106%
Other income (1,061,183.00) (634,881.00) (418,596.00) (196,933.00) 167% 152% 213%
2,518,813 1,828,180 2,012,834 1,778,103 138% 91% 113%

862,991 2,820,580 2,448,152 1,850,511 31% 115% 132%

Finance cost and bank charges 31,577 34,959 34,548 49,482 90% 101% 70%
Profit before taxation 831,414 2,785,621 2,413,604 1,801,029 30% 115% 134%

Taxation 459,913 1,252,306 693,723 548,513 37% 181% 126%

Profit / (loss) after taxation 371,501 1,533,315 1,719,881 1,252,516 24% 89% 137%

Total comprehensive income / (loss) for the period 371,501 1,533,315 1,719,881 1,252,516 24% 89% 137%

Source: Philip Morris Pakistan

ILLICIT TRADE IN THE TOBACCO INDUSTRY 23

 References
1. Illicit trade prevention. (2019, August 31). [Link]
2. Report, S. (2023, May 22). Illicit cigarettes trade remains 18 percent in Pakistan. The Nation.
[Link]
3. Report, R. (2022, November 27). Sale of illicit cigarettes on the rise. Brecorder.
[Link]
rise#:~:text=Illicit%20cigarette%20consumption%20in%20Pakistan,through%20tax%20evasion%2C%20analysts
%20said
4. Major Pakistani cigarette manufacturers witness decline in sales as smokers opt for cheap alternatives. (2023,
May 31). Arab News PK. [Link]
5. T. (2023, August 2). ‘Policy implementation vital to curb illegal cigarettes.’ The Express Tribune.
[Link]
6. Sarfraz, S. (2023, May 15). Illicit cigarette industry’s market share expands to 39pc. Brecorder.
[Link] smuggling threatens Pakistan’s tobacco industry. (2023,
October 13). Pakistan Today. [Link]
pakistans-tobacco-industry/
7. S. (n.d.). Illicit, Illegal or Smuggled Tobacco Products in P - event details. [Link]
smuggled-tobacco-products-in-pakistan--deconstructing-tobacco-industrys-narratives/event_detail
8. Sales of illicit cigarettes thrive on high taxes. (2023, April 16). [Link].
[Link]
9. Home | StopIllegalTrade. (n.d.). [Link]
10. Fatima, A. (2023, February 9). Illegal Trade of Cigarettes Causes Annual Losses of Rs. 1000 Billion to Pakistan.
Startup Pakistan. [Link]
billion-to-pakistan/
11. Desk, W. (2023, November 9). Pakistan Customs seizes illegal cigarettes worth Rs15.6 million. Hum NEWS.
[Link]
12. D. (2023, June 2). New study reveals Track and Trace system kept illegal trade of tobacco products at 15% - The
Dayspring | Youth Centric Newspaper of Pakistan. The Dayspring | Youth Centric Newspaper of Pakistan.
[Link]
products-at-15/
13. Desk, W. (2023, June 6). PM Shehbaz ’s directives on illegal tobacco trade hailed . . . Daily
Pakistan Global. [Link]
hailed
14. Author, G. (2023, March 19). Govt Fails to Stop Illegal Tobacco Trade Leakages Despite IMF Concerns.
ProPakistani. [Link]
concerns/
15. Tobacco. (n.d.). Transnational Alliance to Combat Illicit Trade. [Link]
16. Hassan, N. U. (2023, October 12). Enforcement key for efficient tax system as government revenue losses
increase. Associated Press of Pakistan. [Link]
system-as-government-revenue-losses-increase/
17. Additional Rs60bn tax collection from cigarettes expected this year. (2023, May 2). Dunya News.
[Link]
18. Confronting Illicit Tobacco Trade : a Global Review of Country Experiences : Confronting Illicit Tobacco Trade :
a Global Review of Country Experiences. (n.d.). World Bank.
[Link]
reports/documentdetail/677451548260528135/confronting-illicit-tobacco-trade-a-global-review-of-country-
experiences
19. M. (2023, June 8). Pakistan losing Rs956bn annually from 5 sectors: IPSOS. Mettis Global Link.
[Link]
20. Pakistan | Tobacco Atlas. (n.d.). Tobacco Atlas. [Link]
21. Tobacco | StopIllegalTrade. (n.d.). [Link]
22. Tobacco | StopIllegalTrade. (n.d.). [Link]
23. Investor information. (n.d.). [Link]
information

ILLICIT TRADE IN THE TOBACCO INDUSTRY 24