The plastics industry in India became promising from 1957 with the manufacture of polystyrene. Since then, the industry has grown and diversified rapidly. The industry has over 2,000 exporters. The plastics industry employs 4 million people and includes more than 20,000 processing units, 80-90% of which are small and medium-sized enterprises. This sector is expected to grow to 9.1 lakh crores by 2025. Thanks to its commitment to environmental sustainability, 90% of rigid plastics and 60% of flexible waste is recycled. 90% of PET bottle waste is recycled while internal plastic waste is used in the production process.
For decades, plastic has played a vital role in sectors as diverse as agriculture, healthcare, packaging, construction, electronics, transport and machinery. The popularity of plastic can be attributed to its remarkable properties like light weight, durability, chemical stability, and the ability to be molded into a variety of shapes and sizes. Plastics are so versatile and part of our lives that you will find them everywhere.
Indian plastics exports in the year 2019-2020 amounted to USD 10.00 billion, and is expected to reach USD 25.00 billion by 2025. In the financial year 2021, India exported plastic raw materials worth 3.29 billion USD. India’s plastics industry manufactures and exports a diverse range of raw materials such as plastic molded extruded products, polyester films, plastic sacks and woven bags, polyvinyl chloride (PVC), fabrics and sheets leather, packaging, laminates, fishing nets, travel goods. among others. The national availability of raw materials is a major advantage for the industry. Therefore, plastic processors are not dependent on imports. Raw materials including Polypropylene, High Density Polyethylene, Low Density Polyethylene and PVC are manufactured domestically, thus making India a potential sourcing hub for these products globally.
The plastics industry is a major contributor to the Indian economy by manufacturing goods worth ₹3 lakh crore per year. Thus, India can become the global hub for premium sourcing. Despite many positives, the industry is facing challenges such as rising costs and shortage of raw materials such as polymers, increasing ocean freight, shortage of containers, and inverted duty structure due to some free trade agreements. The sector also faces fierce competition from China. Government support on these issues will ensure the growth of domestic industry and also help exports.
A PLI program for the plastics sector similar to that in other industrial sectors announced by the government can stimulate the production of plastic products and also support exports. The competitiveness of plastic products can improve with the guaranteed quality and reduced cost of energy for industry and lower interest rates for capital investment. Specific inclusion of targeted plastic products in future FTAs could also support export growth
Initiatives like ‘Atamanirbhar Bharat’ and ‘Vocal for Local’ have encouraged industry and boosted exports. Government and industry should work together to further encourage growth and create a sustainable environment for the Indian plastics industry to become the global sourcing hub.
The opinions expressed above are those of the author.
END OF ARTICLE