Financial Daily from THE HINDU group of publications
Thursday, Mar 13, 2003
Financial Daily from THE HINDU group of publications Thursday, Mar 13, 2003 |
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Industry & Economy
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Plastics High input cost hits plastics units Our Bureau
Mr Mohan. K. Jain, President, All-India Plastics Manufacturers' Association, with Mr Harpal Singh, Chairman-Environment & Recycling Panel, at a press conference in Mumbai on Wednesday.
MUMBAI, March 12 THE Rs 25,000-crore plastics manufacturing industry in India has been badly hit by a sharp rise in the prices of domestic raw materials during the last few months, forcing it to cut production by 40 per cent of the installed capacity. According to Mr Mohan Jain, President of the All-India Plastics Manufacturers Association (AIPMA), the prices of domestic raw materials have ballooned by 18 to 26 per cent during the last five months. While the local PVC prices had gone up by 26 per cent (from Rs 39,556 per tonne in November 2002 to Rs 49,996 this month), that of LDPE and polypropylene had increased by 18 per cent and 24 per cent, respectively, he told presspersons here on Wednesday. He said on the other hand, high import duties had made it difficult for the industry to even retain its domestic market share. He felt that the import duty on raw materials should be reduced to bring it on par with those prevailing in the neighbouring countries, which ranged from six per cent to 13 per cent. "For the industry's survival, there should be an immediate rationalisation of the local duty structures on finished goods. It has also become essential for the industry to be given a free hand to import technology, machinery and moulds to produce high quality products to become globally competitive,'' according to Mr Jain. The industry at present comprises 22,000 processors, with more than 85 per cent in the tiny and small-scale sectors, and about 15 raw material manufacturers. "With a per capita consumption of a measly 3.6 kg, as against the international average of 19 kg, the domestic plastics industry has the potential to grow four times that of the existing size, given the right support from the Government,'' he said.
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