New Delhi – India’s plastic industry expected to touch Rs 5 lakh crore-mark by 2025 from existing size of Rs. 2.25 Lakh crore and employ 6 million people to become one of the largest employers in the country, an industry official said. “The fast growing plastic industry will help India in becoming a USD 5 trillion economy for which government needs to support MSME (Micro, Small and Medium Enterprises) in the areas of good infrastructure, easy financing and favourable regulatory policies. If government ensures favourable policies and support, MSME’s in plastics industry would play a major role in India achieving its goal by 2025,” said Mr. Arvind Mehta, Chairman, Governing Council, The All India Plastics Manufactures Association (AIPMA).
Mr. Mehta said, the domestic plastic industry expected to reach turnover of Rs 5 lakhs crore by 2025 from existing size of Rs 2.25 lakh crore. The industry is expected to employ around 6 million people by 2025 from current size of 4.5 million jobs, thus becoming one of the largest employers in the country.
The industry strongly opposed proposal of Indian Chemical Council to hike import duty on raw material as it could lead to supply disruption and in turn will affect cost competitiveness of 50,000 plastics processor in India. Industry has recommended Government to increase the custom duty on finished goods to 20 per cent to stop imports of cheap and unsafe material in India. It also has demanded to impose anti-dumping or safeguard duty on import of cheap plastics finished goods and minimum gap on custom duty between raw material and finished goods be maintained at 12.5 per cent.
While supporting Central Government’s concern of importing safe and quality material, Industry has requested Government of India to avoid mandatory specifications on raw material or fix them at wide tolerance after due consultation with the Indian plastic processing industry. Industry has demanded that all operational difficulties in registration and renewal is taken care by BIS before making the standards mandatory. Manufacturers following ASTM or EU standards should be exempted from taking BIS standards. Industry recommends that Government should prepare a comprehensive plan to support the processing industry before taking steps to make mandatory standards for finished goods,” said Mr. Arvind Mehta, Chairman, Governing Council, AIPMA.
How MSME’s in Plastic Industry will help India create a USD 5 TrillionEconomy
- Government needs to support MSME in the areas of Good Infrastructure, Easy financing and favorable regulatory polices
- Subject to favorable policies and support by Government of India: –
- MSME’s in Plastics Industry would play a major role in India becoming USD 5 Trillion Economy by 2025. Plastic industry expected to reach turnover of Rs. 5 Lakhs crore by 2025 from Rs. 2.25 Lakhs crore currently.
- Plastic Industry in India to be one of the largest employers by 2025. Expected to employ around 6 million people by 2025 from 4.5 Million currently
- Major surge in exports from India to be driven by Plastic Industry by 2025. Expected to touch USD 30.0 Billion by 2025 (Annual growth of around 20%). From USD 8 Billion currently Number of exporters to increase to 6000 from 3000 currently
- Industry strongly opposes proposal of Indian Chemical Council for increasing import duty on raw material.Increasing custom duty on raw material will lead to supply disruption and in turn will affect cost competitiveness of 50000 plastics processor in India.
- Industry recommends Government to increase the custom duty on Finished goods to 20% to stop imports of cheap and unsafe material in India.
- Impose Anti-Dumping or Safeguard duty on import of cheap plastics finished goods
- Minimum gap on custom duty between raw material and finished goods should always be maintained at 12.5%
- Plastics finished goods (plastics and its articles) should be excluded from all FTA’s
- Accountability of FTA’s for all stakeholders
- To increase exports (Amend Labor laws, Revise Power rates (one rate for all of India) and enhance quality of power)
- Govt of India should urgently consider reimbursement of State levies and local taxes (ROSL)
- Business Facilitation canters should be setup at all Indian Embassies abroad
Technology Upgradation Fund (TUF)
- Industry strongly supports the TUF proposal submitted to GOI
- Capital Investment subsidy of 10% for Plastics processing machines and 30% for Plastics Recycling machines
- Rs. 3000 crore subsidy (Rs. 600 crore) demanded by the plastics industry for Technology Upgradation Fund.
- Wil helpadditional employment generation of 800,000 by 2023-24
- Production of Plastic to increase from current 20 MT to 34 MT
- The export of plastics finished goods is expected to nearly double from US $ 8.0 Billion currently to US $ 15.0 Billion in next 5 years
- Capacity utilization currently is around 40% is expected to improve to 60% by 2023-24.
- Revenue growth is expected to be around 9% CAGR
- Significant Energy Saving – 30% to 60% energy saving depending on the machine (All Electric, Hybrid)
Mandatory BIS standards
- GOI has proposed making BIS standards of certain items as mandatory, which are presently voluntary in nature. They propose to initiate action under section 16 of the BIS Act 2016 which empowers the Central Government to make BIS standard mandatory in the public interest.
- Industry supports Government’s concern of importing safe and quality material.
- Avoid mandatory specifications on raw material or fix them at wide tolerance after due consultation with the Indian plastic processing industry.
- Make sure that all operational difficulties in registration and renewal is taken care by BIS before making the standards mandatory
- Manufacturers following ASTM or EU standards should be exempted from taking BIS standards.
- Recommends aligning IS standards with ASTM and EU standards
- AIPMA strongly recommends making mandatory standards for Plastic processing Machinery
- AIPMA strongly recommends that Government should prepare a comprehensive plan to support the processing industry before taking steps to make mandatory standards for finished goods.
Single Use Plastics
- Government plans to Ban Single Use Plastics by 2022.
- The industry is aligned towards Environment protection.
- Banning is not the solution.
- Phasing out and Banning of specific products/ group of products should be considered only after due process to understand 360 degree view.
- Emphasis should be on practical execution towards solution.
- Stake holders across value chain have to contribute towards successful implementation.
- Every district should have Recycling facility. Government should support. Collection should be done at Panchayat level.
- Municipal corporations have to connect with PRO’s.
- AIPMA formed a core committee to represent places processing i. Should represent to Chief Secretaries of all states
- Should conduct mass awareness programmes
Extended Producers Responsibility (EPR)
- Should not be imposed on Processors manufacturing less than 1000 metric ton per annum and turnover of Rs. 25 crores
- EPR contribution of processors should be in proportion to the value addition
- MSME’s should be absolved of all compliances
- Difficult for MSME’s to comply with proposal drafted by MoEF
- Should include packaging waste only
- Focus should be on Non- valued waste
- Existing system should be supplemented
- EPR Framework should be supported by single unified digital platform
- Uniformity of laws across nation (one nation one law)
- Accept trade bodies and associations as aggregators
- Govt. should be liable to maintain confidentiality of data
- Immediate revocation of closure notice