₹5 Parle-G Now ₹4.45, ₹10 Oreo Now ₹8.90: GST Price Cuts Confuse FMCG Companies and Shoppers
₹5 Parle-G Now ₹4.45, ₹10 Oreo Now ₹8.90: GST Price Cuts Confuse FMCG Companies and Shoppers
Next-generation GST reforms slash product prices, but confusion over how to pass on benefits remains
India’s fast-moving consumer goods (FMCG) shelves are undergoing a quiet revolution as popular round price points like ₹5 and ₹10 are disappearing. With the new GST structure in force, biscuits, chocolates, shampoos, and everyday essentials have seen their prices dip below traditional benchmarks, creating confusion for both consumers and companies.
For the first time in two decades, Parle-G’s smallest pack of biscuits is no longer priced at ₹5, but at ₹4.45. Similarly, Oreo packets that earlier cost ₹10 are now priced at ₹8.90. Other staples are also affected, a ₹1 candy is down to 88 paise, while a ₹2 shampoo sachet now costs ₹1.77.
The changes stem from the simplified GST structure announced earlier this month, which has reduced tax slabs to just two — 5% and 18% — while shifting many food products to the NIL or 0% category. Prime Minister Narendra Modi, calling it a “GST Savings Festival,” said the reforms would directly benefit the poor, middle class, youth, women, farmers, and small businesses.
But FMCG companies are caught in a dilemma. Should they pass on the GST benefits by reducing prices or increase product weight while keeping round price points intact? For consumers, the new rates mean awkward bills, small packs costing ₹4.45 or ₹8.90 don’t fit easily with traditional cash payments. Experts suggest customers will increasingly pay digitally or buy larger packs for easier transactions.
Mondelez Price Cuts
Mondelez has slashed prices across its portfolio. A ₹30 Bournvita pack now costs ₹26.69, Oreo biscuits worth ₹10 are now ₹8.90, and Gems and 5 Star packs worth ₹20 are down to ₹17.80. The company has urged dealers to ensure these savings reach customers.
Nestlé’s Strategy
Nestlé has also adjusted prices, combining cost cuts with added weight in some products. Veg Atta Noodles worth ₹30 are now available for ₹28, while the larger Maggi Noodles pack has risen in weight from 560 grams to 600 grams but dropped in price from ₹120 to ₹116. Maggi Ketchup now costs ₹178 instead of ₹190, and KitKat bars worth ₹35 are being sold at ₹30.
What Lies Ahead?
Industry leaders believe the current sub-round pricing may be temporary. Companies could return to familiar ₹5 or ₹10 price tags by increasing product weights in the future. With demand for small packs remaining high — 79% in shampoos, 64% in biscuits, and 58% in chocolates — manufacturers are under pressure to balance consumer affordability with operational clarity.
For now, while shoppers enjoy cheaper prices, both companies and retailers await government guidance on how exactly to implement the reforms without disrupting the market.
