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“Products with less salt, sugar, trans fats should be taxed at lower bracket”
Monday, 17 May, 2021, 08 : 00 AM [IST]
After a drought of events, CII is all set to organise the virtual Packaging Expo and Conference from May 18, 2021. Piruz Khambatta, chairman of the event, and CMD, Rasna Ltd, discusses the event and the topics that it is likely to tackle such as impact of the anti-dumping regulations and tariff barriers on imports and processing; sustainability in packaging; innovation in plastic packaging and recycling, and best strategies post-pandemic as also important developments like WHO’s recently-released guide on salt, in a detailed telephonic conversation with Kimberley Fernandes. Excerpts:

Tell us about the CII Packaging Expo and Conference.
When we had planned the expo we were not expecting a second wave to hit so bad. We are looking at packaging in important ways; packaging is branding and marketing. There has been a huge debate about GST on packaged goods – unpacked food would be at zero tax and packed food would be at a higher tax. We have always said that packing itself ensures that food is safe, so there’s no point in taxing packaged food because it has a huge role to play in the safety of the food in the first place. When you buy loose oil or loose atta, you don’t know whom to hold responsible in the case of impure or adulterated food.

Packaging plays a huge role in extending the shelf-life of the product. It ensures that nutrition, vitamins, minerals, natural oxidants are well intact. Packaging has a huge role to play in the appeal and marketing of a product. As we move forward there are issues about sustainability in terms of goals, sustainable packaging, less plastic and more paper, recycling, and new technology in packaging which will aid safety and hygiene standards as per norms set due to the pandemic. We wanted to encompass all these things and hence, we are having a conference.

Apart from being the chairman of the event, you are also a speaker, what are the topics that you will cover?
The pandemic should not be used as an excuse for companies to stop marketing. Businessmen have to understand that this will go on, there will always be uncertainty. We have to use these tools like virtual events, to plan for the future, be future ready and invest in the future of the business. There's a lot of negativity going around and we need to let entrepreneurs invest in the future and invest in things like Atmanirbar Bharat. We don’t need to import anything, we need to invest in more industries in India itself in order to replace the foreign imports. In the packaging field as well, a lot of things are imported, so I think we need to move towards import substitution. Why should we say no anti-dumping duty, let us make those products in India itself.

What I'm going to concentrate on is how we move to future ready packaging and how we ensure that we don’t rely on imports for everything and how we truly can become Atmanirbhar Bharat.

It’s because of the pandemic that virtual events are being held. What are your observations about the response to virtual events?
I have been attending and hosting virtual events since long before the pandemic, local as well as international. A lot of buyer – seller meets which were earlier made possible by flying to foreign countries have now begun to get done in one tenth the amount. Even if the registration fee is $2000, it is still worth it because it is cheaper than the physical exhibition. I believe that there’s a lot of cost savings and focus because these virtual sessions are pre-booked-- that way you know whom exactly you will be interacting with as opposed to an exhibition, where you end up meeting some consultant and he’s taking up all your time and energy. At least in the virtual meeting, you do your homework beforehand, so you can have more focussed meetings, and you are able to explain much better. Timing is not an issue, for example if someone is in USA, can very well attend the meeting at midnight as well. There are a lot of positives, the only thing that is missing, according to me, in business there is an emotional touch, something which you gather by shaking hands, having a glass of Rasna or coffee together, that is what is missing.

Single-use plastic ban has taken a backseat. Do you plan to take this up?
Single-use plastic is actually the disposable plastic which is not used by industry people like us; no industry was ever using single-use plastic. If you visit Juhu beach, you’ll find the gutters are clogged with these single-use plastics like those small cups for tea, and the ones the pan masala is wrapped up in. I think, honestly, it was pretty fair to ban the single-use plastic because they’re not required and end up causing more harm than good.

When you package milk which is required for a child’s nutrition, it requires a multi-layer plastic, and on the other hand, there is single-use plastic that is being used to wrap up pan masala. People have to understand that sometimes there’s a kind of need for plastic, whereas, sometimes, there is no need for plastic. We have to see the distinction between the two, so to speak. From the pollution point of view, the lockdown is very good because there’s no one on the streets, so I’m sure the beaches are much cleaner than they were a year back. So that’s a positive, and I support the ban on single-use plastic, as it is not a requirement. We can have paper cups, disposable cups for street vendors. My friends in the fast food industry have also taken it upon themselves to introduce very positively, paper and disposable containers.

What is the response received from other countries? Will there be any international speakers and what are the topics that will be covered?
A few foreign companies like Tetra Pak and a few Swedish companies will be attending. We are working with them and the various trade bodies, and our counterparts abroad to attract a lot of participants. We are definitely looking at a few foreign speakers.

How has the pandemic impacted the packaging and food processing industries?
It has to be understood that what is essential for essentials should be allowed. Unlike the first lockdown there is a lot of clarity this time around. So luckily the industries are less affected than in the past, and the export related industries are also open today, they’re not shut nor has Government stipulated a closure but in some places there is misunderstanding on the fact that essentials are allowed non-essentials are not allowed, which is fine but then again, if dairy is essential then the plastic packaging for the dairy also becomes essential. Similarly, if you are making raw material which goes into the use of a non-essential, that also becomes essential. That’s one area where more of the states like Maharashtra and Gujarat, which are much more modern in the understanding of this fact as they have accepted it but some of the smaller states are not, which causes unnecessary problems at the supply level. I believe that there should be a central norm on this and some clarifications would help.

There are talks about a third wave, when do you feel recovery is likely?
Our country had this whole situation under control but somehow it got away from us. We need to do our part in controlling the situation first.

How far will the recent measures from Government towards MSMEs help in their recovery?
I have always been saying a few important things are required immediately because we have all witnessed in the first wave. I have observed that the big companies have become bigger and wealthier. The brunt has been borne by certain segments like hospitality, airlines, and distribution agents for foods like soft drinks, ice cream, chocolates, confectionery; these MSMEs who are also impacted because they don’t have the bandwidth to manage all these complications. So other than the monetarials which Government is giving, I personally believe that they basically need fresh loans, soft loans just like they have in America which are at zero per cent interest, in order to keep the show running. Number two which they did for two three months and then stopped – at least for the affected industries, the statutory labour ESI PF, which are statutory compulsion, should be supported by Government.

For example, Let the 22 per cent PF be paid by the government, at least till the pandemic is on.  The advantage would be that people will have more money in their pockets as well as more money saved.  Something of this sort which will benefit everyone. It was carried out for a few months last year and should be brought back this year also, to tackle the second wave.

WHO has released guidelines for the industry to cut salt usage. What are your observations?
Generally all industry people have voluntarily decided and many MNCs too have decided that since our own children eat the products we put out in the market, it has to be healthy. I am a father first and then a manufacturer, all four of my children drink Rasna. And all my friends in the industry believe the same. So we are saying that anything in proportion is good. We have all adopted government’s Eat Right campaign – So you can have a balanced meal if you have a little bit of salt, sugar, a little bit of everything. We all support government in this Eat Right campaign- there are interactions, ground events, virtual events, exhibitions on the same. All the industry players have voluntarily decided that we will cut down on salt, sugar and trans fats in our products. We are all moving to better edible oil, sweeteners, replacement of sodium. Government should also take it seriously, to enforce certain laws which would help back it up.

For example, If you want to call a product jam, you require 65 per cent of sugar. On the one hand Government is saying to make products with less sugar but on the other hand jam requires 65 per cent sugar; what kind of logic does this form? Jam can be made with 40 per cent sugar as well. If I add a sweetener, I have to mention that it is not suitable for children but sweeteners are being used world over, in fact in the confectionary industry; you can import from Malaysia, Indonesia, China and America, they have sugar replacers. All of this, India doesn't allow, and this causes a lot of confusion. These norms are rendered counterproductive.

Even if we want to go toward less sugar, less trans fat, less salt, and the industry fully supports it, Government regulations have to start supporting this kind of progression towards it. Another important point is that these products will become more costlier. If I replace sugar with Stevia, it will be more costly. My suggestion to Government would be that the products that contain less salt, less sugar, less trans fats should be taxed at a lower bracket to compensate for the higher raw material.

How has the pandemic affected the beverage industry?
In the months of February and March, the beverage industry had a great start, it really kicked off because everyone thought that everything was back to normal. Ice creams and beverages recorded historic sales, however, as soon as the cases increased in Maharashtra, the road ahead looks bumpy, and unfortunately it's now summer. It's not that the consumers are not demanding these goods, the bumpy road ahead is due to there being a lot of ‘ifs’ and ‘buts’ in the supply chain. People are not very sure about what will happen in the near future. For example, if someone who generally buys 100 crates, doesn’t want to do so because of the fear of being stuck with all 100 crates, he then buys only 10 crates.
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