Mumbai — The 87-year-old India’s famous biscuit brand Parle-G may have to lay off 10,000 workers due to the slowing down of Indian economy and the GST tax, if Government doesn’t take necessary steps, a company execute said on Wednesday.
Category head of Parle-G Mayank Shah said over phone that there is a sharp drop in Parle’s biscuit sales which means the company may have to slash production, which may result in layoffs of 8,000-10,000 people, HindustanTimes reported.
“The situation is so bad, that if the government doesn’t intervene immediately … we may be forced to eliminate these positions,” he said.
Shah said that demand for Parle-G biscuits had been worsening since India rolled out a nationwide goods and services tax (GST) in 2017, which imposed a higher levy on biscuits costing as low as 5 Rs, or just 7 cents a pack.
Eventually, the higher taxes have forced Parle-G to reduce biscuit quantity in each pack, which has upset the low-income consumers in rural India who constitute two-third of Indian population and contribute more than half of Parle-G’s revenue.
“Consumers here are extremely price-sensitive. They’re extremely conscious of how many biscuits they are getting for a particular price,” Shah said.
Parle-G was founded in 1929 as Parle Gluco in Mumbai, and in 2003 it became World’s largest selling biscuit brand. It has had an annual income of $1.4 billion, but due to GST the Parle-G’s production got a heavy hit.
The management held talks with the former Indian Finance Minister Arun Jaitley to review tax rates but nothing has come out positive.