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The Hindu
2 days ago
- Business
- The Hindu
Resolve GST rate ambiguity on flavoured milk, levy 5%: dairy industry
Dairy industry in Telangana has urged the State government to help resolve ambiguity surrounding the Goods and Services Tax rate on flavoured milk by pushing for a formal GST Council notification for a uniform 5% levy. The State government recommending uniform GST classification for flavoured milk under the 5% GST slab will be in line with judicial rulings and industry practices as well as ensure clarity, consistency and fair taxation, the industry said after its representatives met Commissioner of Commercial Taxes K. Haritha here recently and submitted a representation. They informed the official that a majority of industry players had already adopted the 5% GST rate for flavoured milk, based on recent court rulings that classify flavoured milk under HSN 0402 as a dairy product, not as an aerated or beverage item. The delegation included K. Balakrishna Reddy, Secretary, Indian Dairy Association and Head of Operations, Dodla Dairy; J. Sambamurthy, COO, Heritage Foods; V. J. Michel Pitra, CFO, Lactalis India (Thirumala Dairy); P.P. Manoj, CFO, Creamline Dairy Products (Jersey); Azeem of Masqati Dairy; and CA Mohd. Irshad Ahmed, Chairman, GST and Customs Committee of trade and industry body FTCCI. Dairy sector is crucial for rural livelihoods and consumer health. Misclassification or higher taxation on value-added dairy products like flavoured milk can disrupt both the supply chain and affordability, the delegation said. Ms. Haritha assured the delegation that the matter would be examined and appropriately taken up with higher authorities. Separately, in a representation to the Secretary, Fitment Committee of the GST Council Secretariat in Delhi, the Telangana Chapter of Indian Dairy Association appealed to the Committee to retain the 5% GST on flavoured milk and not increase it to 12%.
Hindustan Times
26-05-2025
- Business
- Hindustan Times
India's dairy sector pushes for safeguards in US trade talks
MUMBAI, - India, the world's largest milk producer, must protect millions of small dairy farmers in its trade talks with the United States to avoid market disruption from any surge in U.S. imports, industry officials said. India is negotiating a comprehensive bilateral trade agreement with the United States after Washington imposed reciprocal tariffs including a 26% duty on Indian goods, later paused for 90 days. The United States, whose dairy exports reached $8.22 billion last year, is pushing for greater access to India's dairy market, which remains shielded by high import duties and non-tariff barriers. "It is necessary that we do not give them very cheap access to our markets," said Jayen Mehta, managing director of the Gujarat Co-operative Milk Marketing Federation Ltd , which owns Amul, a household name and the country's largest dairy brand. "They are intended to dump their surplus in our country, which we cannot afford," Mehta said. The average herd size in India is only two to three animals per farmer, compared to hundreds in the United States - a difference that puts small Indian farmers at a disadvantage, industry officials say. India's dairy sector feeds more than 1.4 billion people and provides livelihoods to 80 million farmers, making it critical that trade negotiations do not harm milk producers, most of whom are rural poor, Mehta said. India accounts for nearly a quarter of global milk production, with output reaching 239 million metric tons, more than double U.S. output of around 103 million tons. The Indian dairy industry is valued at $16.8 billion. New Delhi has previously excluded the dairy sector from bilateral trade agreements and will continue to protect it, as the government recognises its role in supporting small farmers, said R.S. Sodhi, president of the Indian Dairy Association. The country's dairy industry should also be protected due to cultural and dietary considerations, as cattle in the United States are often fed feed containing animal by-products, which does not align with Indian consumer preferences, Sodhi said. A senior official at the federal trade ministry said India is resisting pressure from the United States to open its dairy sector in the current bilateral trade talks. India will not surrender under any circumstances, and the dairy sector will continue to enjoy protection, said the official, who did not wish to be named since the deliberations were not public. Dairy farmers say they need government protection. "The government needs to make sure we're not hit by cheap imports from other countries," said farmer Mahesh Sakunde from the western state of Maharashtra. "If that happens, the whole industry will suffer, and so will farmers like us."
