Food Companies Seek Relief On Duty Hike, Policy Revision At World Food India—NDTV Profit Exclusive

Top executives from over 100 food companies, including Britannia Industries Ltd., PepsiCo India, Haldiram's and ITC Ltd., met Union Commerce and Industry Minister Piyush Goyal and Minister of Food Processing Industries Chirag Paswan on the inaugural day of World Food India.The closed-door meeting, which lasted for more than two hours, was aimed at addressing pressing concerns faced by the food processing sector."The objective of this CEO roundtable was to provide a platform to industry representatives of food companies to put forward their concerns and suggestions in front of the government," Paswan said on the sidelines of this meeting. "There were several concerns related to ease of doing business. Departments concerned with these issues will now look to find a solution," he said.He emphasised the importance of promoting the state-level food processing firms to make India a global hub for food products.The discussions centered around issues like taxation, subsidies and regulatory challenges. During the meeting, the executives sought clarity regarding current customs duties, which have become increasingly critical as businesses navigate a complex economic landscape. Some companies voiced concerns about the production-linked incentive scheme after being denied subsidies due to changes in the rules, according to people familiar with the matter.The government has unexpectedly revised the rules in the middle of the game by disallowing companies to use imported raw materials to qualify for benefits under the PLI scheme, one of the executives said on the condition of anonymity.This regulation is adversely affecting many businesses, the executive said, urging the government to conduct consultations before implementing such changes to avoid potential hiccups..The government, as part of the scheme, offers financial assistance to manufacturers in a bid to enhance the accessibility of Indian products in niche international markets. However, they have now prohibited reimbursements through distributors.An executive of a packaged food company who attended the meeting said they lack legal entities in the country and, therefore, how can they pay local agencies. This has stirred frustration among everyone involved, the executive said, expecting a resolution in the coming weeks.Another key issue was the ban on wheat exports, with companies negotiating for its reconsideration.The CEOs also raised concerns about the recent import duty hike on refined edible oils and its potential impact on sales. A top executive of an edible oil and food manufacturing company if they are unable to raise prices, as mandated by the government, they risk incurring substantial losses.In light of this, there are calls for the government to reconsider its pricing directives to help safeguard profit margins.Some CEOs advocated for a reduction in goods and services tax on breakfast cereals, from the current 18% to align with the 12% rate applied to butter, ghee, and packaged fruit juices.Paswan assured that the ministry would advocate for these interests at the GST Council. However, the final decision on GST matters rests with the council, he added..E-Commerce Retailers Face Critical Test This Festive Season Amid Quick-Commerce Boom

Food Companies Seek Relief On Duty Hike, Policy Revision At World Food India—NDTV Profit Exclusive

The closed-door meeting aimed to address pressing concerns in the food processing sector.

NDTV Profit

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