In a stunning admission, the Pakistan Dairy Association (PDA) has acknowledged the public’s deep distrust in the quality of packaged milk — a perception that continues to fuel Pakistan’s massive loose milk consumption, despite health risks and lack of regulation.
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Facing mounting consumer rejection and policy heat, the PDA — instead of accepting responsibility — turned its guns on the government for rejecting its demand to slash sales tax on dairy products from 18% to 5% in the federal budget.
Speaking at a press conference, PDA Chairman Usman Zaheer admitted that consumers prefer loose milk because they don’t trust what’s inside the carton — a damning reality for an industry that claims to be producing “milk up to international standards.”
In an apparent damage-control move, the PDA touted exports to the U.S. and Middle East and promised to slash retail milk prices by Rs. 50/litre — but only if the government agrees to cut GST. “The government didn’t honour its budget promise,” Zaheer said, warning that export targets would crash and tax revenues would shrink.
The data, however, tells a more complicated story. While tax collections from the sector grew from Rs. 13 billion in 2023 to Rs. 44 billion in 2024, the PDA is now threatening a reversal. “This is the first and last time such a hike will be seen if tax rates remain high,” Zaheer claimed.
PDA officials said milk exports rose from $15 million in 2023 to $35 million in 2024, but they warned their $70 million target is now in jeopardy, citing a 20% drop in volumes since July 2024 when the current tax regime took effect.
In an aggressive pitch to the government, the dairy lobby argued that cutting GST to 5% could reverse the 20% volume slump, boost revenues by 22% year-over-year, and reduce Pakistan’s undocumented loose milk trade — all while bringing prices down for consumers.
Yet despite these claims, the PDA’s failure to build public trust or deliver on quality perception remains the industry’s Achilles’ heel. Until it wins over consumers, tax breaks alone won’t fix what’s curdling public confidence.
