India bans e-cigarettes in setback for Juul and Philip Morris

NEW DELHI, (Reuters) - India banned the production, import and sale of electronic cigarettes yesterday, a public health decision that will dash the expansion plans of companies such as Juul Labs and Philip Morris International in the country.

The ban will be imposed through an executive order and will include jail terms of up to three years for offenders. It was not clear whether the use of such products would be prohibited.

India’s health ministry, which proposed the ban, had said it was needed to ensure e-cigarettes don’t become an “epidemic” among children and young adults.

“Considering the seriousness of the impact of e-cigarettes on the youth, the cabinet has approved an ordinance to ban e-cigarettes,” Finance Minister Nirmala Sitharaman told a news conference.

India has 106 million adult smokers, second only to China in the world, making it a lucrative market for companies making vaping products such as U.S.-based Juul, as well as Philip Morris which manufactures a heat-notburn tobacco device.

While announcing the ban, Sitharaman showed various types of products to the media, including a Juul vaping device, which resembles a USB flash drive.

Juul had plans to launch its e-cigarette in India and has hired several senior executives in recent months. Philip Morris also has plans to launch its heat-not-burn smoking device in India, Reuters has reported.

A spokeswoman for Juul in India declined to comment. Philip Morris did not immediately respond to a request for comment.

The ban order needs to be approved by the president before it takes effect, but this is typically a formality.