CHENNAI: Choked by a shortage of raw materials, the Tamil Nadu plastics industry has been struggling to survive amid the pandemic. To stay afloat, plastics processors are pressing for a regulatory authority to curb undue profiteering by petrochemicals producers.
The sector has been facing hardships — in the form of price hikes and poor supply of raw materials — since Covid-19 struck, explained Tamil Nadu Plastics Manufacturers Association (TAMPA) president S Rakkappan. "Domestic prices have increased manifold without any consideration of the impact on processors. Many units are just trying to regain stability after the lockdown," he added.
Former president of the Tamil Nadu Plastic Manufacturers' Association B Swaminathan said polymer producers want to introduce a minimum import price (MIP), which could unduly enrich them, and this was thwarted by TAMPA and other associations. Now, the producers are trying to seek levy of anti-dumping duty on import of polymers. This will again give them an opportunity to hike prices, said Swaminathan.
He said domestic polymer producers, led by one company in particular, are holding the processing industry to ransom. The impact could soon be felt across the domestic industry, which is dependent on plastics. This includes sectors dealing with food and beverages, electricity, construction, automobiles and edible oil. "The list is huge as most sectors in India are dependent on plastics," said Swaminathan.
Rajesh Kumar Sayani, who is a partner with Plastometal, which has unit in Ambattur, told Express materials such as polypropylene, a thermoplastic polymer used in a wide variety of applications, was initially priced at Rs 86,000 per metric tonne, but now costs Rs 98,000 for the same quantity. This had a big impact on the industry in Tamil Nadu. Prices keep increasing as manufacturers, who are burdened by a lack of working capital, are shutting shop.
The State has more than 8,000 manufacturers, and 60 per cent of them are in and around Chennai. The industry contributes Rs 2,100 crore as GST to the nation, Swaminathan pointed out.
In a letter to Prime Minister Narendra Modi, plastic manufacturers and processors, represented by more than 10 associations across India, have demanded the constitution of a regulatory authority to curb undue profiteering in the petrochemicals industry, which they say has left the plastic manufacturing and processing industry on the verge of collapse.
The associations also demanded a halt in imposition of anti-dumping duty, mandatory BIS standards, a decrease in import duty on raw materials, and a ban or restrictions on export of raw materials to enable the plastic industry to remain competitive with countries such as China.