1- PRIVATIZATION OF UNITED BANK
2- VEGETABLE GHEE/OIL PRICES
3- THE PRIVATIZATION PROGRAMME
4- IMPROVEMENTS IN PUBLIC SECTOR ENTERPRISES
5- LEASING SECTOR: POISED FOR RAPID DEVELOPMENT

 

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VEGETABLE GHEE/OIL PRICES

 

Government considering to rationalize prices

 

By AMANULLAH BASHAR
Aug 12 - 18, 2002

 

The vegetable ghee and cooking oil prices, the essential commodities of daily consumption, have gone up exorbitantly due to levy of taxes while the increase in international prices has also added fuel to the fire.

On an average, the consumer has to pay an additional price from Rs10 to Rs11 per kg for vegetable ghee/ oil which, is obviously a cause of concern for the low-income group.

It may be noted that around 150 units are engaged in the production of vegetable ghee/edible oil in Pakistan. The number of 150 units represents both the organized sector and the units working in the cottage industry. According to an estimate these units produce between 2.5-3 million ton which is far more than the total requirement of the country.

According to informed sources, a major chunk of the vegetable ghee/oil goes to neighbouring countries including India, Afghanistan as well as Iran through undocumented trade causing huge losses to the national exchequer by tax evasion. The quality and taste especially of the vegetable ghee produced by some big industrial houses is far superior than the taste and aroma of the commodity produced in India, hence, it is the much sought after commodity in India and Afghanistan. It is amazing that while a good size of quality ghee and cooking oil finds its way in the neighbouring countries, the citizens of Pakistan are exposed to the hazard of using low quality ghee and cooking oil being sold in the market in loose form. According to informed sources some of these unscrupulous cooking oil producers are selling untreated cooking oil in the market, which is highly hazardous to the human life. This untreated oil is higher than the melting point of the human physic thus causing several diseases especially in the low-income brackets.

The vegetable ghee/oil prices were increased soon after announcement of the federal budget for 2002-2003 due to levy of sales tax i.e. 15-20 per cent plus increase in price of palm oil in the world market taking a quantum jump of over 100 dollars a ton. Yet another reason for price increase is the hike in international prices. The palm oil prices in the world market during the first month of the current year were around 302 dollars which have gone up to the level of 407.89 dollars a ton in July 2002.

Consequently, the edible oil and ghee prices registered a jump soon after the announcement of the budget. A pack of 2.5 kg of Dalda cooking oil was selling at Rs180 which jumped to Rs201.76. Similarly, vegetable ghee of the same brand and volume was selling at Rs180 prior to the budget which also increased to Rs201 per pack. The price pattern of other popular brands was almost on the same lines. Habib oil prices of one kg increased Rs60.50 to Rs67.88, Pakwan pack of 2.5 kg from Rs128.25 to Rs129.38 etc.

Meanwhile, Pakistan Vanaspati Manufacturers Association has demanded of the government to except vegetable ghee/cooking oil industry from the requirement of Section 73 of Sales Tax Act, 1990 as this industry by itself is not in a position to register the un-registered shopkeepers failing which the vegetable ghee/ cooking