Plastic industry seeks setting up regulatory body to curb undue profiteering in petrochemicals industry

By: |
December 2, 2020 5:15 PM

To elaborate their grievances, the associations have said in the letter that the prices of the raw materials like PVC, ABS, polypropylene, PC, PET have increased multi-fold ranging between 20 and 140 per cent over the last five months.

Domestic producers demand anti-dumping proceedings on select grades of polymers on which they are already charging premium due to constrained availability. Domestic producers demand anti-dumping proceedings on select grades of polymers on which they are already charging premium due to constrained availability.

Plastic manufacturers and processors have urged the government to constitute a regulatory authority to curb undue profiteering in the petrochemicals industry that has left the plastic processing sector on the verge of complete collapse.

In a letter written to Prime Minister Narendra Modi on November 26, plastic manufacturers and processors — represented by more than 10 associations across the country — have jointly demanded setting up of a regulatory body, according to a statement.

The associations have also demanded to stop imposing anti-dumping duty, mandatory BIS standards, decrease import duty on raw material and ban or restrict export of raw material to enable the plastic industry to survive and remain competitive with other countries like China.

The plastics industry in India consists of over 50,000 plastics processing units, of which 90 per cent are MSME’s employing more than 50 lakhs people directly and contributing more than Rs 3 lakhs crore to the country’s GDP.

The associations have urged the prime minister to help the plastics processing industry which is on the verge of collapse due to the sharp increase in price of raw material by raw material manufacturers in the country.

To elaborate their grievances, the associations have said in the letter that the prices of the raw materials like PVC, ABS, polypropylene, PC, PET have increased multi-fold ranging between 20 and 140 per cent over the last five months.

“The petrochemical companies are taking advantage of the surge in polymer prices by restricting the supplies to domestic processing units and releasing the material after increasing the prices on regular intervals. “Unfortunately, PSUs have also joined hands with private players and are dancing to their tunes and are not serving the processing industries in a fair manner. Rationale of price increased by domestic industries are not justified as compared to international prices,” the letter has stated.

Domestic producers demand anti-dumping proceedings on select grades of polymers on which they are already charging premium due to constrained availability.

Raw material manufacturers export the raw material in large quantities and create scarcity of the polymer raw materials resulting in an exponential rise in price of raw material by petrochemicals companies in the last five months, the letter has said.

The plastic manufacturers and processors have sought to constitute the Petrochemical Regulatory Authority to ensure that the PSUs like IOCL, GAIL, BPCL support the domestic processing units by serving them in a fair manner and fair pricing mechanism.

The industry players have further demanded that the government should immediately stop imposing non-tariff barriers on raw material such as anti-dumping duty and mandatory BIS standards as India is import dependent and consumption of several polymers is much higher than domestic production.

They have also demanded an immediate ban on export of raw material from India to ease out the supply in the country and to check the price rise, the letter added.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Sterling and Wilson Solar commissions 25-MW solar energy project in Oman
2Tata Elxsi, Syntiant to provide low-power edge AI device development for voice applications
3Budget 2021 Expectations: ‘Credit scheme must be in line with ECLGS to act as MSMEs’ ‘first-loss’ cover’