Very Good morning today we have with us Dr. Mahendra B. Parmar, president AIPMA, All India Plastic Manufacturers Association & Managing Director of Polyblends. We also have Mr. Viren Sanghvi, Director Exports – Polyblends.
Plasticsinfomart.com: Starting from your background, would you like to shed some light on your educational background, where you started from and how you get into plastics?
Dr. Parmar: First let me greet as we are meeting after Diwali, so wish you happy and prosperous New Year. My background is basically I am a mechanical engineer. I did my engineering in 1975. Then I did my masters degree in plastic engineering. And subsequently I did my doctorate from department of chemical technology.
Plasticsinfomart.com: Talking about Polyblends, you started as an entrepreneur or was it a family owned business?
Dr. Parmar: Well it started by me only as a founder.
Plasticsinfomart.com: So you started this business as an entrepreneur, what made you step ahead and make your career as an entrepreneur and not as somebody looking for a job?
Dr. Parmar: I was in service for almost 13-14 years with Kabra group. And we were having same product like master batches for pvc profiles. I was the person who is the creator of masterbatch in plastic bag also. Same product I started as soon they shifted their production center in Daman.
Plasticsinfomart.com: So what made you feel that it was right time for you to venture into the business?
Dr. Parmar: See my father and others were not doing service. My father, grandfather never did a service. I was the only person in family who did service for few years and they believe that ours is a gujarati blood and we should be entrepreneurs. And I have experience in masterbatch technology. I did doctorate in pigmentation so I thought it is better to start my own business rather doing service with others. Where I have my own way to look into the market and where I can utilize my own utility to deal with in my own direction.
Viren: One of the needs and main reasons where we differentiate ourselves and which has been the strategy right from the start. All other masterbatch manufacturers are looking at volumes, we look at value. There are so many custom colored masterbatches that have to be designed. If you go to any other masterbatch company, they usually match the masterbatch in nearly one or two months, by that time the customer might or might not have the order. Here our specialty comes. We are so fast and so accurate in color matching, we are really acclaimed by the whole industry. Instead of going for volumes we rather go for value. If we actually look at the competitor analysis , they might be doing 1000 tons per month of Rs. 30 per kg, for example we do 100 tons per month of Rs. 300 per kg, so that lower volumes gives us the ability to focus on a product and to improve our quality and to give them better value. So that’s where we differentiate ourselves and was a very clear need as compare to what is happening right now. We have a focus on niche market.
Plasticsinfomart.com: So what all are the industry sectors and segments serviced by Polyblends?
Dr. Parmar: Basically the plastic processing industry is divided into three things one is injection molding, one is film extrusion and fibres.
Viren: We always try to go for the high end market, fibres. We have a phenomenal range for polypropylene fibers, for polyester fibres, for polyamide 6 fibres. We are the only people in whole of India who can offer something called micro pallet masterbatches, which is right now at this as we speak , manufactured only by six masterbatch companies in the whole world. And we are the only masterbatch manufacturer in whole of India who can give you micro pallet masterbatches.
Plasticsinfomart.com: So you have a kind of monopoly of this product in India?
Dr. Parmar: Unfortunately, the Indian market is not yet evolved enough to grasp enough micro pallets. It’s basically meant only for the export market. But I am sure from five to six years; Indian manufacturers will also have those sophisticated machines which demand micro-pallet masterbatches. So right now the product is only for export market and that too for first world countries like Europe, Scandinavia, Canada, USA etc.
Plasticsinfomart.com: What are all the geographies you are covering right now?
Viren: Right now we are doing exports to more than around 17-18 countries. But most of our exports are towards Europe towards, Scandinavia, towards Canada and first world countries. Now because of the recession we are forced to move into African markets, into Bangladesh, into Nepal. And we are very pleasantly surprised about the market share, so actually it is a blessing in disguise because we were ignoring the growing markets and we were going after the grown markets. But now whole new strategy is to tap the developing world.
Plasticsinfomart.com: So developing countries are better to explore for such product?
Viren: Very much, if you can guarantee payments in some kind. It’s a phenomenal opportunity.
Plasticsinfomart.com: would like to shed some light on the worldwide scenario for masterbatches, and market share of masterbatches in plastic industry?
Dr. Parmar: Within masterbatches itself there is a diversification, there is something called white and black masterbatches which I would like to name commodities, though they are not commodities. But I would say commodities black and white which go in values and volumes. And there are color masterbatches. So if you look at the percentage share in terms of volume, 60-70% is taken over by black and white masterbatches. And around 30-40% is taken by color masterbatches. But if talk about value, then 70% of the value comes out of the color masterbatches and 30% of value comes out of black and white. So that’s how the whole segregation is world over.
Plasticsinfomart.com: The development happening in the Chinese plastic industry could be an alarming situation for India in coming years?
Dr. Parmar: No, I don’t think it will create any problem in Indian industry, particularly, Indian craftsmen are better than Chinese craftsmen. And we are very strong in metallurgical engineering. So I indeed don’t find that machine wise, or manpower wise or education wise we are inferior to china. We are far superior to Chinese people. We never face any threat. Only the fiscal structure or the taxation part of the government and support from the government has brought the Chinese on an upper hand.
Plasticsinfomart.com: Whole world has witnessed economic slowdown in last two years. Has it made any impact on Indian plastic industry?
Dr. Parmar: Though last year was a recession period, if you see growth of the plastics and demand of the plastics, you will realize there was scarcity of supply. It is not able to cope with the Indian market. There is constant 15% of growth by which the plastic processing industry is going on. And I don’t think it will stop for next five years. So I will expect 10-15% growth for next five years, it’s a healthy growth.
Plasticsinfomart.com: Do you believe government of India is taking good enough steps to support Indian plastic industry?
Dr. Parmar: Government is supportive in a democratic country, what they are doing is good. We can’t compare a communist government and a democratic government in this line. We don’t want to compare India and China in the same line. Government is doing better and is improving every year.
Plasticsinfomart.com: But isn’t there a big scope for government to step in and make changes?
Dr. Parmar: Government is taking steps for that. They are creating infrastructure where they can accommodate plastics. They are looking after building and construction industry where they can include the pvc pipes instead of steel or galvanized pipes. Government is supporting us in many respects.
Plasticsinfomart.com: In a country like India where recycling of plastics is about 65%, largest in the world and has largest number of small and medium processors. Do you believe that ban on plastic bags by Government suggests initiatives are on right track?
Dr. Parmar: I would like to interfere that; Government should not ban any plastic bags. It’s a littering habit of the people and waste management habits which makes government to ban this thing. If we create proper waste management practices, plastics will not be banned. On the contrary, Plastics is saving forests and greenery. If you see, 1kg of paper and 1kg of plastics, the plastic requires less energy comparing to paper. Or if you see the carbon dioxide emission and global warming, the plastic is necessary to save the global warming. Another fact, if we have a proper waste management or even the waste what is produced is utilized, like in rod making or making some molded articles from waste, no problem will arise. If you cater plastic rag picker and they collect the plastic waste in a proper manner and supply it to government or some NGO who can utilize this plastic in various ways, the problem will be solved. On the contrary, in Bangalore, rods from plastic are being manufactured from plastic waste. They are finding scarcity of plastic waste. If someone wants tonnage capacity of plastic waste, it is not available in India. So banning plastic bags or putting restrictions on containers or laminated plastics is not correct. They should educate the people, how to utilize plastics, how to utilize and manage plastic waste and we should create a culture on using plastic and educate about plastic. And education starts from schooling only. Today schools are teaching against plastic, I think we should stop this.
Only plastic is truly recyclable material. If you see paper, once it is used, it is thrown away and then we have to produce new paper or recycle old paper. To produce one kg of paper you will need almost double to triple amount of energy compared to plastic. So carbon foot print is very important.
Viren: If you look at the comparison reports between India and US or Europe, or any other leading country. Over there the consumption of plastic per person is almost 20-25 kg per person. Well in India it is only 5kg per person. But what happens is that wrong things are being blamed for the problems we are having. The real thing to be blamed is the littering habits of the people. If you go to Europe or USA there is a separate bin which is called recycle bin where you are supposed to put your plastic waste. Now suppose if you ban plastic, how you are going to replace it? By wood! And when you cut down the wood, it will automatically lead to more pollution. Plus, it requires three trees to create something which two kilos of plastic can easily create. There is no doubt for it. So, instead of letting go such a huge potential of plastics, how about actually looking at things which are real problems, the littering habits of the people.
Like, how about giving incentives to rag pickers? That, if you pick plastic waste, and if you give a certain spot, you get more money compare to doing something else. That is one approach. Point number two, having clear demarcations about the waste that you create. People throw everything in single dustbins. How about having two dustbins? One for plastics (recyclables) and one for others. That way we can really utilize the good resource which is given to us as compare to blaming things.
Give facts to students. Even small children are very intelligent. They know the right & wrong. But if you give them a biased view right from the start they will stop thinking. So, yes AIPMA as a foundation is trying to promote it by organizing essay competitions at schools, where they are made to think that what really the cause of creating this pollution compared to just blaming that on something else.
Plasticsinfomart.com: Would you like to suggest any three applications which will be the focus area in plastics for the coming year in India?
Dr. Parmar: Agriculture, medical use and construction. Bad part is, being India an agricultural country, yet abroad 15% of plastics go into the agriculture while we are using only 3%. You talk about kennel living, you talk about drip irrigation; it is a phenomenal opportunity which can be used. So those are the things which are not being even tried in India.
Plasticsinfomart.com: As you are a first generation entrepreneur, what would you like to suggest as thumbnail rules which can make or break success for budding entrepreneurs?
Dr. Parmar: Integrity and commitment.
Viren: Of all questions I think, I am the most qualified to answer this one. The kind of freedom Dr. Parmar has given us, maybe even he doesn’t know himself. It is so imbibed within him. There is something called unique ability. I keep telling people that it is really an honor and we really are proud to be associated with polyblends. The amount of freedom you get to use your creative abilities is phenomenal. There is no work process and there is no work bureaucracy you have to go through. You have a complete freedom and at the same time people trust you completely. Now if you misutilize the trust, the consequences are equally bad, there is no doubt about it. But at the end of it, what Dr. Parmar is most interested in is the bottom line. Have you the promoted the brand image of the company? Have you created the sales turnover that is required? There is no strict hierarchy you know, as that he is my senior or I am his junior. Isn’t it so evident right now? The fact that though I am not at all involved in this, he involved me since I was here. SO you know that small gesture itself speaks the way the whole organization works. So, when there is the deepawali puja in the
office, we are the ones who actually organized the whole thing. So, the kind of freedom and free spirited nature is there in this organization is unparalled.
Point number two is unique ability. Because Dr. Parmar is Ph.D. In plastics, he sticks to technology. Of course he overlooks finance, he overlooks marketing, but he doesn’t interfere in those subjects. We have a perfect gentleman who is a chartered accountant who looks after the finance and logistics. I am an MBA in international marketing so I look after the exports. There is another person who is very good in local sales so he looks after the local sales. And Dr. Parmar overlooks it. But his passion and love is in quality control and R&D. so that is one department he is accountable for. So instead of being a thorough entrepreneur, I do everything, and I am responsible. Like there were so many brochures were designed which Dr. Parmar came to know after they were designed, so that is the level of freedom we have here.
Dr. Parmar: In Gujarati community, integrity and commitment are very important. We commit what we are doing. If I committed x price to my customer and though the market price has gone up and I will be in loss, still I will fulfill my commitment.
Plasticsinfomart.com: Any management lesson you would like to share with our listenrs?
Viren: Proactive and integrity. And integrity is not only about keeping your promise. It is about doing what you said by the time you have to do it. one of the biggest reasons why we are so successful in the international market, the only way we differentiate, and this whole organization is that way, right from the top to bottom, is that we honor what we said. When you go into international market, people say yes to everything. Here the first thing we say is no. if we cannot handle it, we cannot handle it. There is nothing to be wrong or shy about that. But yes, when we say no and then a yes, it is something we will do till the end. Complete transparency, any customer who comes to us is most welcome to come and visit the factory. And more than that the brochures that we create, that comes into the integrity. In the brochures everything is written which we have in the factory. There are no lies about it. If we are small we are small. If we are big we are big. If we are strong into something we are strong into something. If we are weak into something we are weak into something. Like we have said so many no(s) to so many orders which are for commodities. Like black and white masterbatches. We say look, this is not our strength, it is best that you go to our competitors. And we also suggest the competitors’ name. And in the same way when we say, this is our strength; they believe us because we have guts to say no.
Point no. two is Proactive. We don’t wait for market to react to something. If we know that there is a requirement, we are proactive in our approach. Instead of customer asking us for something, once we know that customer would like to go for something else, we are going to do it 100%.
Dr. Parmar: It is our mission and vision.
Viren: As even our peon, who cleans the table, knows what is our mission and vision. Ask the worker working on machine, he will explain the mission and vision in his local language, but the essence will be the same. He might not use big words like integrity, proactivity, customer delight, etc but he will simply say ‘yahan pe humko kaam karke bahut garva mehsoos hota hai’. He is proud to be associated with the company; it is as simple as that.
Plasticsinfomart.com: would you like to change any one thing which you would like to change in the current scenario?
Dr. parmar: I would like to give a message that if you want to compete USA and china in plastic industry, we should have a mass production. The volumes should be very high.
Plasticsinfomart.com: But that of course requires a high amount of investment also? Do you think people in India from plastic industry have that strong financial background?
Viren: They are educated. Again as I told you, in Europe and us, people are using per person 20-25 kg of plastic. Now look at their population and India’s population. We are on consumption of 5kg of plastic per person. If we just increase from 5 to 10 we are talking about 100% growth. So the whole thing that really applies is education. Now here we have the government who says, ban plastics. And here we see such a huge gap in terms of kennel living, in terms of agriculture, in terms of packaging, in terms of building cars, in terms of building infrastructure, we can use plastics so much if we start getting ready the people in right sense. And the entrepreneurship drive, the willingness to try on something new, if that comes through then automatically the industry will grow.
Dr. parmar: Only one thing will intervene in this. If you want to compete in the international market, you should have a right approach. If people can reduce the price and produce high volumes, while maintaining the quality, it should be fine.
Plasticsinfomart.com: what is your vision for Indian plastic industry in 2020?
Dr. parmar : We should be the highest consumer of plastic raw material, better than even china and USA. Our population is far bigger than that of USA, and our population is almost equal to china. SO we feel there will a jump from 5 kg to 15 kg by 2020 due to the growth of population. We will be the largest processing industry in terms of requirement compared to anyone in the world.
Plasticsinfomart.com: And beyond satisfying the internal needs, do you think we will act as global sourcing hub also?
Dr. parmar: We actually represent a global processing hub. This year when PlastIndia took place, we did almost 1000 crore (INR) business as a whole. And presently India is exporting plastics valued 4bn $. And by 2012 we can see almost double to 1.7 times growth in export.
Plasticsinfomart.com: As a president of AIPMA, what steps you suggest AIPMA would undertake in the coming few years which could better the scenario for plastics industry in India?
Dr. parmar : First and foremost thing is AIPMA will work with government and raw material supplier. Raw material should be available at a proper price so the small processor and a medium scale processor can get it as and when required. So our exports as well as local needs can be attained. If we have to import from other countries that are small and medium scale processor cannot import 5-7 tonne. Companies like reliance, Haldia and ONGC should supply that material demand. We can even grow export of the end product to other countries. Currently we are exporting to 176 countries, but my aim is to export to 256 countries.
Viren: AIPMA is already taken steps in terms of creating awareness. Like, we are holding technical seminars, at the processing plants like Daman, Noida, by bringing specialists from US. Like there is a gentleman who talks about precision injection molding. He has basically studied in the US and is teaching people on injection molding over there. We actually going to bring him
over here and actually make them give seminars in Daman, Noida where is plastic manufactured; not in Mumbai. In Mumbai we are launching a special management program to increase the entrepreneurship within the plastic industry. Where people actually know what management is, where people actually know what dedication is, where people actually know what next step is to be taken. That way AIPMA has launched 2-3 very good initiatives just recently and we hope they will go long way.
Dr. parmar: What we have spoken here about ban on plastics. We are creating an entire new cell of AIPMA to fight against the wrong concept about the environment and plastics. We are creating a new office to fight against this issue.
Plasticsinfomart.com: Would you like to share your message to the clients of Polyblends and Indian plastic industry as a whole?
Viren: I can speak for the international clients, because that’s really what I look at. First of all, thank you for trusting us enough. Because we export to countries like Sweden, where none of the masterbatch manufacturer has ever gone before. And point number two, thank you for being so open. It is through them that we learn. We don’t claim to know everything, but when they open up their processes, when they open up the ways the actually process, we can then suggest so many new things. And together we can grow. So working with each and every customer of ours is a pleasant surprise. Of course it takes a little time to break through and it is well justified. Because you can’t expect everybody to trust everybody. But once the trust levels are established, and yes another thing is we look for this association on a long term. We are not overnight operators. We don’t make profits from the first kilo that we sell. We want to grow slow and steady. So if you look at a growth, there is no sudden jump up. So basically a crawl, walk and run company. We don’t want to running right from the start. First crawl then start walking and then run. So that’s how we progress.
Dr. parmar: In AIPMA we have almost about 1500 members. Indirect member strength is about ten thousand, which gives opportunity to almost 10 lac people to get associated with AIPMA. So India is a hub of plastics and by next decade, India will be the sourcing hub with most economical rate and with the best quality in the world. People will put trust in India in all the respect, in our plastic products, in our prices, in our quality and our honesty.
So, this was Dr. Mahendra B. Parmar, president, AIPMA (All India Plastic Manufacturers Association), and Director of Polyblends India Pvt. Ltd.