Published On: Wed, Jul 13th, 2011

Adani Group plans plastic processing park at Mundra

The Adani Group’s Mundra Port and Special Economic Zone Ltd (MPSEZ) is planning a

200-acre plastic processing park that will seek to attract investment of about Rs.4,000 crore, said senior officials of the Gujarat industries ministry and the Adani Group.

“We have recently received a copy of a proposal to set up a plastic processing park from Adani Group’s MPSEZ. The plastic park will come up in Mundra and will be spread across around 200 acres inside the SEZ,” said a government official who didn’t want to be identified.

The park will house injection moulding, blow moulding, extrusion and other units to manufacture plastic furniture, PVC (polyvinyl chloride) pipes and packaging material among other plastic products.

MPSEZ chief operating officer Pankaj Modi confirmed the submission of a proposal to the Union and state governments for the plastic processing park but refused to give any details “as the project is at a concept stage”.

A senior Adani Group official who did not want to be identified said: “The proposed park is mainly aimed at attracting plastic manufacturers to create a cluster. At present, there are over 30,000 small, medium- and large-sized plastic processing units scattered across the country.”

The official said MPSEZ offers the advantage of proximity to a functioning port that can be used to import raw materials and also export finished products.

“Units can source raw materials like polyvinyl chloride, polyethylene, polystyrene and polypropylene via the sea route from either domestic manufacturers like Reliance Industries Ltd (RIL) or it can be imported,” the official said.

While refusing to divulge names, the official said many plastic manufacturers had expressed interest in setting up units.

Units can choose to cater to the overseas markets and avail SEZ benefits or serve the domestic market, which has a large untapped potential, by paying duties, the official said.

“Such a project can be of great interest to players as the demand for plastic is growing rapidly in the country,” said P.D. Trivedi, chairman of the Indian Plastic Institute, which carries out research and runs skill development courses. “The potential in the country is huge. Currently, the Indian consumption of plastic products is around 6kg per capita while the world average consumption of plastic is over 20kg.”

India’s plastic consumption, around seven 7 tonnes (mt) per year, is likely to double in the next three to five years.

“Of the total consumption, we are importing over a million tonnes of plastic. In the coming years, we will certainly need more manufacturing within the country to meet the rising demand. Apart from Reliance Industries, which produces 1 mt (per year) of polypropylene (one of the resins used to make plastic products), many more players like IOC (Indian Oil Corp. Ltd) are also expanding their polypropylene capacities,” Trivedi said.

The country’s plastic industry generates around Rs.85,000 crore revenue per year, which is growing at around 15%, said S.K. Ray, senior executive vice president, polymers business, RIL.

RIL’s polypropylene units are located at the Hazira and Jamnagar petrochemical complexes in Gujarat.

State-owned IOC has a polypropylene capacity of 600,000 tonnes at Panipat in Haryana. The company is planning to set up a 1.2 mt per annum polypropylene project at its Paradip refinery in Orissa, with an estimated investment of Rs.4,500 crore.


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