One of the world's biggest tobacco companies, British American Tobacco, has denied suggestions that it has had connections with cigarette smugglers.

The company was responding to allegations in The Guardian newspaper in Britain that it has benefited from the smuggling of billions of cigarettes.

Nobody doubts that tobacco smuggling is big business, and getting bigger.

The more governments in different countries have increased taxes on tobacco, the greater the temptation for criminals to sell it as contraband.

In Britain alone, officials estimate that smuggling last year cost the government more than $3bn in revenues.

A number of big tobacco companies have been accused in the past of being connected to tobacco smuggling themselves, and from benefiting from it through increased sales.

The latest allegations are that BAT supplied distributors with tobacco while being aware that it might then be sold on the black market.

BAT says that it wants to stamp out smuggling, and that it cannot be held responsible for the actions of others.

It adds that the accusations appear to be based on documents taken out of context.

But a British anti-smoking campaign group, ASH, has called for a government inquiry, while accepting that BAT had not itself been involved in smuggling.