Spiritual Guru-Yoga Teacher turned entrepreneur: Baba Ramdev, founder of Rs 10,000 crore behemoth Patanjali is not satisfied, yet.
In one of the brutal-est domination plan every unleashed in India, Baba Ramdev is forcing Govt. of India to impose a special ‘Sin Tax’ on cola giants Coca Cola and Pepsi.
On the other hand, talks are on sell Patanjali’s products in ration shops (also called Fair Price Shops) in Madhya Pradesh; a move which will make Patanjali as the largest FMCG company in India.
Making this domination plan clear, Baba Ramdev had earlier said, “Colgate will be below Patanjali by this year, and in three years, we will overtake Unilever. Patanjali products would shut the ‘gate’ in Colgate. The birds in Nestle’s nest (logo) will also fly away”
Sin Tax for Coca Cola, Pepsi?
Baba Ramdev, along with RSS is lobbying hard with Govt. of India to impose a special ‘sin tax’ of 40% on beverage companies, which are selling products with high sugar content.
If this pressure tactics work, then in the next budget which would be presented in January, 2017, companies like Coca Cola, Pepsi may need to pay this special tax, thereby increasing the price of their products and effectively demolishing their market share.
A top unnamed health ministry official has said, “The representatives of Ramdev and RSS have argued for high taxes on carbonated drinks,”
The base of arguments put forth by Baba and RSS regarding this special tax is the recommendation of GST panel headed by chief economic adviser (CEA) Arvind Subramanian. The panel had sought a sin tax of 40 percent on aerated drinks, tobacco and luxury cars.
Although Patanjali has denied any such efforts, SK Tijarawala said, “Our products have made a serious impact in India. We will launch more healthy products soon.”
This clearly means that Patanjali is all set to launch more beverages in the next year’s summer season, and efforts are already on to make them hot selling products.
The concept of sin tax to curb sales of oily, greasy food and fats is not new. In July this year, Kerala became the first Indian state to impose special tax of 14.5% on the sales of fast food such as burgers, tacos and pizzas. This was done to create awareness about obesity and food habits.
Similarly, countries like Denmark, Hungary, Mexico and some states in USA imposes special taxes on beverages, fast food and fatty food.
Interestingly, beverage companies have been known to put extra sugar in Indian version of their products, compared to Europe or USA. For example, as per London based Action on Sugar organization, Fanta uses only two teaspoons of sugar in Argentina, Ireland and UK, whereas in India, its 6 teaspoons.
Coca Cola uses 10.6 gms of sugar per 100 mg, which is 5.5 teaspoons per 250 ml can.
Beverages companies like Coca Cola are clearly scared, and efforts are on to repel this sin tax of 40%. They have already told that if this tax is imposed, then they will need to shut down several units in India, and several thousand employees can be out of job.
As per them, a ripple effect would be visible across the society, and this can have severe negative economic impact.
Coca Cola has said, “An acceptance of the Arvind Subramanian committee recommendations with regard to GST rate of 40 percent on aerated beverages, will have a negative ripple effect on the entire beverage ecosystem,”
Patanjali Products Would Be Sold In Ration Shops
In a related news, Patanjali is in talks with BJP ruled Madhya Pradesh to sell Patanjali products at their ration shops (Fair Price Shops).
Minister of State for Cooperatives (independent charge) Vishwas Sarang said, “We are trying to make shops profitable and employ more people so one of the idea is to tie up with Baba Ramdev and sell Patanjali products in every village..”
Opposition parties have claimed that this move will kill smaller local brands, which provide low-cost products in ration shops.
Besides, Patanjali is also planning to sell jeans, as part of their complete domination plans.
Very interesting days ahead for Indian FMCG market..
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