A new bill in Uruguay proposes to legalize the sale of marijuana by the government. Reuters

The Uruguayan government is prepared to enter the drug-dealing business with plans to legalize the production and sale of marijuana under a state monopoly.

"There is no question of Uruguay producing and distributing drugs, but the state will control and regulate the market," said Interior Minister Eduardo Bonomi, the Guardian reported.

"The negative effects of consuming marijuana are far less harmful than the outbreak of violence associated with the black market."

President Jose Mujica has sent the legalization bill to parliament, where his center-left coalition holds a majority but remains divided on the issue.

The political opposition has criticized the bill, saying that it will promote drug abuse and will not reduce criminal activity surrounding the drug trade.

The possession and consumption of marijuana was decriminalized in 2000.

According to Bonomi, the domestic illegal market for marijuana is only valued at around $75 million, not a significant amount, but the idea is to separate the estimated 300,000 marijuana users (8 percent of the population) from more dangerous drugs.

"The main hazard is not marijuana but the dealers who supply much more dangerous substances such as paco [a cocaine derivative], which does terrible damage," Bonomi told the Guardian.

It is not clear how the government would regulate marijuana production, but Mujica has suggested that designating 150 hectares (370 acres) of land for farming the narcotic plant would be sufficient to meet current demand and edge out the black market.

It was proposed during the drafting of the legislation that professional farmers could grow the government supply on small plots of land that would be easy to secure.

Distribution would be handled by a quasi-private company under strict government control, the Guardian reported.

Other proposals have included requiring registration cards to purchase the drug in order to deter foreigners from flocking to the country for “drug tourism,” tracking and limiting purchases, and regulating the amount of THC, the psychotropic chemical compound in marijuana, produced in each crop.

If the bill passes, Uruguay will become the first nation in the world to set up a state-controlled marijuana industry.