The coronavirus outbreak has affected millions of people across the globe and has also caused serious disruption in the global economy. Manufacturers, traders and businessmen are grappling as short supply of raw material, disturbed supply chain mechanism have created huge mismatch in demand and supply in most of the sectors. The plastic industry is no exception. In fact it is one of the worst affected sectors wherein the manufacturers are facing acute shortage of raw material for the past few months.

 

The effect of coronavirus on the sector is so remarkable that plastics processing across the country are now looking at Government’s intervention to streamline the supply of raw material. “The industry is facing hardship because of raw material shortage which will lead to the closure of many units across the country,” said Dilip Gandhi, former President of Vidarbha Plastic Association. Gandhi said that the plastic manufacturing units all over the world are facing hardship due to raw material shortage. “The manufacturers are not able to import raw material on time because of non-availability of cargo containers. Besides, there is stupendous hike in freight charges,” he highlighted. The freight charges for importing raw material have seen four to five times hike in recent past, he pointed out. All India Plastics Manufacturers Association (AIPMA) President Chandrakant Turakhia also said that the industry is facing acute shortage of polymers, the main raw material for plastics goods production.

 

“This raw material has varied application in nation-building including agriculture, healthcare, food and toy sector,” he said. The plastics processing sector has sought immediate Government intervention to ensure raw material supply by Indian petrochemical companies and free imports of raw material that are not produced in the country. Around 50,000 units in the plastics processing sector including 650 in Vidarbha, which offer employment to about 50 lakh workers in the country, are already operating below 50 per cent of their capacity, Turakhia said adding that if the crisis prolongs, then thousands of MSME’s will have to close down.

 

“The increase in raw material costs and its acute shortage in market is leading to escalation in project costs and is adversely impacting the cost competitiveness of MSMEs,” AIPMA Chairman, Governing Council, Arvind Mehta noted. The associations urged the Government to ask Public Sector Units, including Indian Oil Corporation, GAIL, OPAL, Haldia Petrochemicals, MRPL to streamline supply of raw materials in adequate quantities to the MSME sector at fair prices.