P Narendra: For the decade ahead, I would bet on Indian packaging

At the outset of his speech, P Narendra said, "We are going through a difficult phase." He pointed out how in the last two years, "We have seen the world affected by Covid, and how the planet witnessed a supply chain and logistics nightmare, unprecedented price rise plus the Russia-Ukraine war and the China lockdown." He felt, things will be back to normal only when the shipping costs and schedules return to pre-Covid levels. He advised the audience that till such time, we should fasten seatbelts.

He said, "Today, we look at the way forward. None of us have a choice. We have to be in business, and we have to survive, sustain and strengthen."

Narendra segregated the print industry into the following verticals: 1, The publications covering books, newspapers, magazines, catalogues and directories; 2, the graphics segment which covers advertising, commercial print, 3, Transactional and security print; and 4, packaging.

Highlighting the "expected growth trajectory", Narendra said, the first first two may be growing in a sedate manner as far as India is concerned and may plateau in the future. He said, "Why I say this is that the ad revenue generated by Facebook and Alphabet at 171 Billion USD was more than the aggregate ad revenue of every magazine, newspaper, radio station in the world. And - without ads, publications cannot survive."

He added, "The maturing Generation Z which has imbibed the internet from the time of their cradle - have a different set of behaviour patterns and buying habits. This is something which we do not know but we have understood it will influence all businesses including the print industry."

He continued that the transactional and security print will be on a growth path; while packaging is galloping along at a good pace.

The India story as per Narendra is bullish. He shared some highlights with the Infinite Print delegates. He said: India is expected to be the world’s fifth largest consumer market by 2025. He added how globally, the packaging industry is the  third largest after food and energy and it's worth USD 917 billion (in 2019), with 2.8% CAGR - of which the Indian share is 4%.

He mentioned that the sector growth to be 22-25% CAGR (as per Packaging Industry Association of India). He pointed out how the packaging industry grew at 18% CAGR between 2015-2020; and it was USD 31.7 billion in FY 2015 and USD 72.6 billion in FY2020 (Assocham-EY study).

He mentioned how India's per capita packaging consumption is 8.7 kg. This, he felt, is much below the world average. Thus, there’s a lot of headroom for packaging to grow when one compares with the USA (109 kg), Europe (65 kg) and China (45 kg).

He pointed to 100% growth in the last decade from 4.3 kg to 8.7 kg per person per annum. He pointed to the e-commerce growth which meant 65 million monthly unique visitors. He said, "In 2021, India’s real-time transactions moved up to a staggering 48.6 billion, almost threefold that of the closest challenger China with 18 billion transactions, and close to seven times greater than the combined real-time payments volume (7.5 billion) of the world’s leading economies: U.S., Canada, U.K., France and Germany." Citing statistics from the ACI Worldwide Report, he said all this directly impacts packaging requirements.

He highlighted the reasons for the Indian growth story as diversification of supply-chains from China; rapid growth of exports; need for Indian packaging to meet international standards; increasing awareness for hygienic food-beverage-pharma; focus on sustainable packaging; ban on single-use plastics; drive towards biodegradable paper-based packaging; favourable demographics; plus increasing income levels and a growing middle class.

He complimented the government policies like profit-linked tax incentive and adoption of the National Packaging Initiative. He said, the GoI has recognised the potential of this sector. In addition he pointed out how the single-use plastic ban is a boost to the industry. And how even though the per capita consumption of packaging in India is very low, even lower than some of the African countries, the sub-continent faces a dire issue with plastic. He felt this is because of our habit of littering as well as absence of infra-collection.

Narendra said, "And so, when we look at these numbers, even taking an average of figures given by various agencies, we should grow by 100% in 4-5 years."

However, he cautioned the gathering that one must be very vigilant about inflation, the Russia-Ukraine war, the power situation in India and the issue of staffing and personnel.

Next he focussed on the technology quotient. He said, "Offset print continues to be the mainstay of the industry. About 50% of business is with this technology. This means, new presses installed by packaging printers with more and more units and inline finishing capabilities."

He added, "Digital print is here to stay. It has its advantages which include short run and variable data print, plus urgency. The quality is good. There are new print markets like photobooks which have blossomed due to this technology."

He crunched some digital print numbers. He said, "As far as the Western markets are concerned, by 2024, 50% of print value output will be digital for graphics, 18% for publication and 7% for packaging and 3% by volume. So we need not worry that digital will usurp the game." He said, "Offset will be the main workhorse."

However he underscored the importance of hybrid solutions. He said, "I would like to point out here, marrying these two (offset and digital print) and coming up with hybrid solutions is going to be very interesting. Print the carton/label through the legacy method but optfor an additional digital pass creating variable data which gives it a new lease of life."

He added, "One thing we should know is that digital is a part of our life. All pre-press, MIS, servers are digital. But some of us who are not handling data,
we have to learn to be successful in digital, we should have the knowledge and expertise. Having a robust IT infrastructure is important and since the learning curve is steep. So please step into it and start learning right now. When the time comes, we can hit the ground running."

He concluded his speech by saying that the world population numbers are 8.6 billion by 2030; and India will overtake China in 2024. He said with continued urbanisation and 43 megacities with a population of more than 10 million, it will drive demand for advertising, signage and packaging print.

All this information tells us that we are in a good industry. Let's try and be successful (and optimistic) in our endeavours. He concluded his talk by saying, "I am not a betting guy. But for the decade ahead, I would bet on India."

The All India Federation of Masters Printers (AIFMP) hosted the seminar – Infinite Print: An Infinite World on 24 May 2022 at the Crown Plaza in Greater Noida. PrintWeek and WhatPackaging? were the media partners of the seminar.