It emerges as two of the biggest cigarette groups in the world, British American Tobacco and Rothmans International, announced a pounds 13bn merger.
Anti-smoking organisations condemned the move, claiming it would result in developing countries in Asia and Africa being targeted as the tobacco companies try to maintain their sales in a dwindling market.
Campaigners also claimed that health ministers had lost a battle to curb support for UK tobacco firms.
Although embassies will be banned from directly promoting tobacco, the companies can expect to continue to accompany ministers on trade missions, take part in trade fairs and be invited to "networking" drinks parties.
Embassy staff will be told they must offer the same legal advice and support to tobacco companies that they give to other British firms. This will include information on local markets which may help them to win business ahead of foreign competitors.
The support will be particularly helpful as the tobacco firms are facing a ban on sponsorship as well as the decline in smoking in the West.
Hard-sell marketing techniques in the Third World have included handing out free cigarettes to teenagers and sponsoring nightclubs and discos.
Although the Department of Health has taken a strong line against tobacco, Downing Street and the Foreign Office are anxious to protect exports.
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