Fruit growers see 10% FED on juices resulting in lower fruit procurement

Author: webdesk

A double whammy for the juice industry threatens fruit farmers’ livelihoods
In the much criticized mini-budget that the Finance Minister presented on Wednesday, the government delivered a double whammy for the juice industry, by not just increasing the GST to 18% but also proposing a 10% FED. The Senate Standing Committee on Finance and Revenue rejected the proposal to impose the FED on juice industry, saying that it would jeopardize the livelihoods of farmers attached with the value chain.

The juice industry coalition also jointly reached out to Prime Minister Muhammad Shehbaz Sharif, and Finance Minister Mohammad Ishaq Dar stressing that the FED imposition will threaten the sector’s growth that has already seen a slump the preceding few years.

According to industry estimates, the formal juices industry in Pakistan accounts for around 59 billion rupees annual revenue, whereas investment in the industry is estimated to be 40 billion rupees.

Meanwhile, the fruit growing value chain of Pakistan is improving due to the central role of the fruit juices industry. The industry’s collaboration with the farming community prevents overripe fruit from being wasted. Moreover, due to poor storage facilities a lot of fruits are wasted in the peak season, the formal fruit industry sector helps assist with this problem of storage. The industry also helps with providing better processing and more efficient ways of fruit preservation so they are not wasted if produced in bulk. The industry facilitates the farmers’ community by working with and purchasing fruits that are especially available in surplus quantities.

In line with local regulations (such as Punjab Food Authority), fruit drinks have minimum 8% fruit content, nectars have 25-50% fruit content and pure juices have 100% fruit content. In fact, fruit juices are promoted as healthier options by Food Authorities across the country for consumption in schools and colleges.