Vimal Kedia's keynote address at PET conference

Vimal Kedia’s address on the second day of the session on the topic PET: The Sunrise Industry

 

Let me begin with a simple question.

 

How many of you have used PET in one form or the other? Please raise your hands.

 

Well, the response pretty much establishes the fact that PET is an integral part of our everyday life. While we are all aware of the simplicity it brings to our life with respect to storage, handling, and preservation, PET has also found prominence owing to its evolution into one of the most sustainable materials. It can be completely recycled, it is light, compact, and almost unbreakable. When you consider its weight, energy consumption and CO2 emissions, it is far better than the next available alternative.

 

When it comes to rigid plastic packaging, PET is clearly the fastest growing vertical. Due to its water and moisture barrier properties, PET has emerged as the clear favourite, finding its way into various applications that include beverages, packaged drinking water, agrochemicals, food items and pharmaceutical applications. More than 65% of soft drinks are packaged in PET bottles, contributing to a huge chunk of the Rs 4,000 crore PET industry in India. A clear testimony to this fact is how Roohafza, a brand that has had a long association with glass shifted to PET bottles as part of its repositioning strategy. 

 

On the production front, we are self-sufficient in PTA which is one of the important feedstock to produce PET.

 

Reliance has recently commissioned the single largest PTA plant in the world for producing one million tonnes of PTA and this is a big step towards fulfilling our nation’s ambition of ‘Make in India.’

 

Also, research indicates that the BRIC countries are going to be dominant forces in the overall PET market. Among these, India and China have immense potential to emerge as the leaders. Almost 40% of the global demand for PET comes from the Asia-Pacific region alone, and therefore we have the strategic advantage of low operation and export costs to fulfill this demand. Yet another change that’s taking place is the newfound favourability of PET in the dairy industry.

 

The demand for PET bottle packaging for milk and milk products is increasing at 25-30% CAGR, and soon PET will go beyond being a preference for just value-added dairy products. In addition to this, India’s bottled water industry is expected to grow at a CAGR of 22% for the next few years. CSD continues a double digit growth. All these estimates clearly indicate that we’ve ushered in an exciting era for PET – one that will be marked by several technological improvements, innovation, and creative revolutions. 

 

India’s GDP is set to double and household income is likely to triple by 2020.

 

India’s consumer market will be the world’s 5th largest by 2025 and by 2020, India’s PET consumption would surpass 2,000 KTA as against the current consumption of 700 KTA, with the PET industry growing at double digit rates.

 

India started with tiny batch plants of about 10 KTA capacity by Century Enka in the early eighties, with hardly 1 KTA consumption. Today, India’s installed capacity is 1,700 KTA with Reliance single-handedly commanding a capacity of 1,000 KTA.  This capacity stands tall against the current consumption of 700 KTA. Hence, the availability of PET is a given for the next five years.

 

PLEXCONCIL (Plastics Export Promotion Council) is putting up a 3D printing centre, which will be a boon to the industry for development because of its concessional rates.

 

With all these positives about the entire PET and Plastic packaging industry as a whole, we also have a few challenges. There are very few regulations regarding the disposal and recycling of used PET bottles. There is a need for more regulations to prevent any kind of environmental hazard. In spite of all the goodness of PET, many myths are being circulated in the media. From time to time, the industry is being challenged in the courts by different sets of people and competitors alleging that PET usage results in leaching at room temperature and results in antimony trioxide and other toxic chemicals. However, it is a well known fact that PET has been approved as a safe packaging material for beverages, pharma, healthcare and other industries by regulators throughout the world. We have to unanimously prove that the use of PET packaging is good and not harmful.

 

At PACE (PET Packaging Association for Clean Environment), which is a first of its kind platform that includes almost everyone from RM manufacturers, to end users and machinery suppliers; we have started addressing all these issues.

 

(Herein) I would like to talk about the future opportunities for PET.

 

The recent developments in PET include finding packaging solutions to enhance the shelf life of products under India’s tropical condition without preservatives, solutions for CO2 gas aroma & colour retention etc. Through the development of multilayer barrier bottles. Ample work has happened in the development of biodegradable PET which of course is already available in the market now. However, there are certain challenges with respect to cost and barrier which is in advanced stage of further research and implementation. On the regulatory front, it is time to help regulators holistically on the specifications aspect, test methods / equipment, what all needs to be approved, why and how etc. This is to help avoid the huge impact on brands that can result from non-integrated false allegations.

 

In the past, we have handled scenarios concerning health, safety and environment successfully with respect to alcoholic beverages, pharma formulations etc. And now again, there are ongoing false claims with respect to the usage of PET, which are being addressed at the right forums.

 

Last but not the least, PET consumption in India is only 700 gm per capita as against the global consumption of 7 kg per capita.  We see the future growth in this business spearheaded by PET which is safe, sustainable, recyclable and contributes to resources as well as energy conservation.  The value proposition offered by PET is unbeatable by any competitive material.

 

I would like to conclude by saying that such a time calls for greater collaboration. It is a golden opportunity for us to work together and develop India as a leading destination for innovative packaging.