The UK company's proposed 100 per cent subsidiary -- Rothmans of Pall Mall (India) Ltd has set a $70-million incremental exports target over seven years.

Speaking to The Financial Express, company general manager (south Asia) RN Wood said, "In case there are any profits earned after three or four years, they would be ploughed back in the business. The remittance of dividend to the share-holders would be only after seven years of operations," he said.

Rothmans International, which owns 2 per cent stake in ITC Ltd, does not have any immediate plan to divest stake in the Indian company. "If it is a stumbling block, then there would be need to reassess it," Wood said.

"We are getting good dividends right now and it is purely an investment decision," he added. Rothmans is willing to wait for the Foreign Investment Promotion Board (FIPB) approvaland would not want to enter India in any other way, company public affairs manager Michael Pavitt said.

Citing an example, he said, "We waited 16 years to build the Russian factory and are willing to wait here too." Rothmans plans to introduce its brands in the premium-, high- and medium-price segments in India.

The brands owned by Rothmans include Dunhill, Rothmans, Peter Stuyvesant, Craven `A', Winfield and Vogue. "Throughout the world, the trend is now shifting towards low tar and nicotine cigarettes. We plan to manufacture these in India. Rothmans will help the country's farmers in growing the type of tobacco used for these cigarettes," Wood said.

The tobacco major has committed a total investment of $150 million in the country.

"Rothmans does not have any intention of importing tobacco into India. Our cigarettes will be produced with Indian tobacco. In fact, we plan to invest in improving the quality and yield of the tobacco crop in India, and then export tobacco leaf," Wood stated.

Rothmans, which put in an application with the FIPB in November last year, emphasised that it intends to divest 26 per cent in the subsidiary in favour of the Indian public within five years of operations.

After getting FIPB approval, the multinational would either set up a greenfield manufacturing facility or acquire production facilities in the country, particularly in Andhra Pradesh.

This would entail a wide range of activities including upgrading manufacturing facilities, bringing in hi-tech machinery and improving yield and grade of Indian tobacco.