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Mr Amrit Patel, President,
Gujarat State Plastic Manufacturers Assn.
The Indian Plastic Industry is
currently facing a very serious problem of frequent price hikes in polymers
which has resulted in a situation wherein the Plastics Industry in general and
medical plastics industry in particular is facing the problem of survival.
“Medical Plastics Data
Service (MPDS) ” takes this opportunity to put before our readers , the views
expressed by Mr Amrit Patel, President , Gujarat State Plastic Manufacturers
Association.
Gujarat State Plastic Manufacturers Association (GSPMA), the largest Association of Plastic Processing and Associated Industries in India has about 2000 members including a large number of Medical Plastic Disposables Manufacturing Industries. GSPMA is working for the cause of Plastic Industry for last three decades.
MPDS : What is your first reaction to the current price hike problem faced by the Plastics And Medical Plastics Industry ?
Mr Amrit Patel : Gujarat State Plastic Manufacturers Association (GSPMA) strongly opposes the frequent recent price hike being made by the polymer manufacturers in India. It is learnt that the recent hike is the fourth consecutive hike during July/Aug., which is not affordable to Industry. The small scale processors cannot absorb this shock. We fear that plastic processing industry will die drastically and there will be large scale unemployment. At present there are about 20,000 plastic processing units in the country, providing direct and indirect employment to lacs of people. When these units have to put their shutters down, the first casualty would be labour and second would be NPA’s of the Banks.
MPDS : What is the frequency and magnitude of the price hike?
Mr Amrit Patel : The frequent price increase in the Plastic Raw Material Prices has adversely affected the growth of the Plastic Processing Industry which has currently the turnover of Rs 28,000 crores.
The hike in the raw material prices would compel the manufacturers to increase the prices of the plastic finished products to the extent of a minimum of 25 to 30%. As given in the following table, the price changes over the last one year has been varying from 24% to 58% depending on the plastics raw material.
Table : Statement Showing The price changes over a period of one year (16.8. 2003 to 6.8.2004)
|
Polymer |
Price*
per
tonne
(16-08-03) |
Price*
per
tone
(6-08-04) |
Difference |
%
Rise |
| LDPE |
48,970 |
73,689 |
24,719 |
50.48% |
| LLDPE |
45,283 |
64,150 |
18,867 |
41.66% |
| HDPE |
45,597 |
64,280 |
18,612 |
40.81% |
| PP |
49,145 |
63,569 |
14,424 |
29.32% |
| PVC |
47,575 |
58,741 |
11,166 |
23.49% |
| *
(incl. excise)
Sales tax, transportation, octroi etc. are extra as applicable. |
MPDS : What are the expectations of the Plastic Processing Industry From The Government ?
Mr Amrit Patel : Import Prices which were hovering around USD 600 to USD 800 per tonne 6-8 months back, presently are in a range of USD 1200. ( In case of Polystyrene, it has crossed a mark of 1300 USD).
Partly the price rise is because of the increase in feed stock of Naphtha / Ethylene, Propylene, VCM etc. Demand / Supply equation also plays an important role.
As a drastic step to save the industry , we suggest that Customs Duty should be brought down to 0% till the next budget.
Alternately a fixed customs duty may levied as follows:
Price Polymer : (CIF Per tonne)
USD 700 and below Rs 5000/-
USD 701 to 1100 Rs 2,000/-
USD 1101 and above Rs 1,000/-
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