Pakistan Soap Manufacturers Association (PSMA) has proposed a three-point formula for revival of the small soap factories, which have closed down because of the unavailability of the cost-effective raw materials.
The components of the three-point formula for revival of the small soap industry are, first, the government of Pakistan should immediately withdraw ACD on palm stearin; second, allow inedible tallow for use in soap without the condition of Halal certification, and third, if possible, allow import of tallow from India as such relaxation had already been given to the pharmaceutical industry.
PSMA Chairman Zafar Mehmood, while addressing a meeting, said that most of the small soap manufacturing factories operating in the SME sector had been closed while rest were on the verge of closure due to stoppage of import of tallow from India coupled with the unjustified imposition of 7 percent Additional Custom Duty (ACD) on Palm Stearin in the last budget.
He said that by banning the cheaper source of soap industry's raw material and making the other source highly expensive through levy of ACD, the government had thrown soap out of the reach of the poor. Consequently, small factories, facing a drastic cut in demand, have closed down their operation leaving many workers out of job under the current difficult inflationary economy.
PSMA chairman said that the soap industry was using tallow as raw material to produce laundry soap, which was being imported from India and after ban on imports from India, the import of tallow was also banned. Further, the import of tallow in Pakistan was subject to Halal certification and there was no other country except India from where Halal certified tallow could be imported, he said adding that soap was a basic necessity used by everyone, especially laundry soap which was used by the poorest population.
Currently, only big companies who had multiple product lines were surviving, but the small-to-medium-size companies had either been closed or were on the verge of closure.
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