INDUSTRY INSIGHTS

Making a Strong Case for Plastics in the Environment – Interview with Vijay Merchant

The plastics industry has enjoyed a dream run for more than 50 years and plastics have influenced human life making it more convenient, efficient and hygienic. Today, life without plastics is difficult to imagine. However, in recent years the industry has come under attack over concerns about the impact of plastics, particularly plastics waste, on the environment. An easy target because of its widespread use, plastics have gained the tag of being a nuisance.

Dispelling myths and fallacies about plastics, and emphasizing the importance of recycling and proper waste management practices, is industry veteran Vijay Merchant in an interview with Lekhraj Ghai of POLYMERUPDATE.

Vijay Merchant

Vijay Merchant is a commerce graduate and has done post graduate studies in business management from the Indian Institute of Management (IIM), Ahmedabad, where he was awarded a merit scholarship in 1966 and majored in Finance & Marketing. After initial training with the Mafatlal Group Central Finance Division, he headed a large consumer products agency house, serving FMCG companies in South India for 10 years. Over the last 30 years, Mr. Merchant has worked on several national bodies of both the plastics industry and packaging industry on critical issues of development of small scale industries. Mr. Merchant has been President at All India Plastic Manufacturers Association (AIPMA) for three terms and also a founder member of the Indian Centre for Plastics in the Environment (ICPE) created at the instance of the Ministry of Environment and Forests, Government of India. He has also served on national bodies of Indian Institute of Packaging (Ministry of Commerce), Indian Merchants Chamber, Enviroplast Plastindia Foundation and Indian Plastics Institute and was the Honorary Editor of industry journal Plastics News for 10 years.

Besides, for over a decade Mr. Merchant has been actively involved in environmental issues of the plastic and packaging industries in global forums. As a professional with a passion for environment protection, Mr. Merchant has served as a live link between society, the government and the plastics industry, initiating projects and programmes and also sharing these with Asian neighbours and associations in western countries.

Interview of Vijay Merchant (VM) with Lekhraj Ghai (LG):

LG: Please tell us about the plastics recycling industry in India.

VM: Plastics recycling in India dates back to more than 50 years when only a handful of companies like Union Carbide, NOCIL, Polychem and DCM Shriram manufactured polymers that too in limited quantities. Because of the existing License Raj and the some of the Government’s socialist policies there were many restrictions on the import of polymers. While the applications of plastics were on the rise in other countries there was a scarcity of polymers in India, which gave birth to innovative recycling activities all over the country.

LG: How many plastics recycling companies exist In India at the moment?

VM: It is very difficult to come up with an exact number as most of it is in the unorganized sector. There are some recyclers that are registered with local municipalities and gram panchayats, but there is a larger percentage that operates out of slums, shanties and cottages, which are difficult to numerate. For instance, in the Dharavi locality

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission

INDUSTRY INSIGHTS

in Mumbai, which houses one of the largest slums in the world, there are close to 1500 recyclers. There are such recycling pockets in other localities of Mumbai such as Bhandup, Goregaon and Malad, and many recyclers are now migrating to farther places like Dahisar, Vasai and Nala Sopara. Plastics recyclers have mushroomed all over the country and exist in almost every state. At present, there could be around 10,000 to 15,000 recyclers in the country of which 60%–65% fall in the unorganized sector. Gradually, owing to mandatory requirements and other factors such as growth in scale, more and more recyclers are getting registered with local bodies and the unorganized sector, which accounted for almost 80% of the recyclers about 10 years ago, is shrinking.

LG: Isn’t the unorganized sector bad for the economic growth of the country?

VM: Indeed, most such recyclers conduct their business operations in cash and as they have no financial records, it becomes difficult to impose taxes. However, it should be taken into consideration that most of them are uneducated or poorly educated and are yet trying to make an honest living rather than staying unemployed and creating mischief or being a nuisance to the society. In a way, they are self-employed individuals who have honed their skills in the field of recycling. Although uneducated, they are often able to accurately identify the type of plastic just by looking at a piece of plastic waste.

LG: How does India’s recycling industry compare with that in Europe or America?

VM: In the U.S. and even in European countries like Germany, Belgium and Austria, waste collection takes place on a much larger scale. There are also stringent regulatory limits on emissions and effluent treatment restrictions, due to which the recycling facilities, although fewer in number, are mostly large-scale operations. The cost of labour is also much higher than in India and consequently most recyclers in the West have automated plants, which require much less manpower.

LG: What about the rest of Asia, say China?

VM: The number of small-scale recyclers in China is gradually going down as a consequence of Green Fence—China’s new policy on the import of scrap material. Not only is China not allowing mixed and contaminated waste to enter the country but also has enforced stringent internal health and safety regulations. The larger legitimate recyclers are still in operation while smaller ones are either shutting down or moving to recycling industrial parks where they are made to comply with the new rules and regulations concerning waste collection and sorting processes, emissions, water treatment, quality and hygiene standards. Scrap from Europe and America has started heading to other South East Asian countries where the preliminary washing and sorting takes place and is then sent to China for recycling.

LG: How important is technological innovation in plastics recycling?

VM: The increasing applications of plastics and the replacement of other materials like glass and metal with plastics for packaging has resulted in more sophistication in processing and recycling and the use of specialized materials. The world is moving away from rigid, heavy containers to flexible packaging in which plastics play an important role. Flexible packaging often involves multi-layer films, which could be just 5 to 7 micron thick but may contain up to seven layers of different materials like various plastics, metals and certain nylons. Each packaging layer imparts distinct properties and functions such as preventing aroma loss, moisture absorption and contamination. When such a packaging material ends up as waste, it becomes difficult to recycle it because of the presence of the multiple layers. This is probably one challenge that the global recycling industry is facing at the moment. However, there have been certain innovations to improve the sorting process by the use of optical sensors and floatation devices. For instance, recyclers are now able to separate HDPE caps and BOPP labels from PET bottles and recycle all of them individually thanks to the improved segregation processes. Moreover, post-consumer PET bottles used to be a nuisance in India 8–10 years ago when the technology needed for recycling

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission

INDUSTRY INSIGHTS

PET was not available. After the technology was brought in, it was soon mastered by Indian recyclers and today almost all PET bottles in India end up being recycled. At the same time, Indian recyclers have developed indigenous technologies, which allow them to recycle even mixed and contaminated plastic waste into woven products such as carpets, mats, conference folders and gift items.

LG: What are the recent innovations in the field of plastics recycling? What are the advancements and emerging technologies in the field of plastics recycling that India can adopt?

VM: Machinery for the recycling industry is often imported into India from the West. Similarly, there are certain recycling technologies that have been brought in and implemented in India; for example, making three-layer sheets of recycled PET for food-contact applications in which the middle layer is composed of recycled waste. Another technology, which originated in Germany, in use in India is bottle-to-bottle recycling in which the recycled material is as pure as the virgin material. In China, recyclers use a technology to make plastic lumber out of scrap material. Large quantities of plastic waste enters China through Hong Kong, which after washing and cleaning is recycled to make plastic lumber. The recycled product is resistant to cracking and splitting and to all types of rot and mould. The plastic lumber is used primarily as a building material and replaces wood in various applications.

LG: Does the recycling of scrap exported from the West take place in India too?

VM: There are a few export-oriented units and special zones in the country where such waste is recycled and re-exported, but on a very small scale. Rules concerning the import of plastic waste into the country have been tightened in an effort to better waste management within the country. However, it is not that the recycling capacity in India is not sufficient to handle the imported waste and many recyclers operate at lower rates because of the poor waste collection practices in the country. Probably less than 5% of the total consumption would be from waste that comes from outside of India.

LG: What are the challenges faced by the recycling industry in India?

VM: The Indian recycling industry is challenged by the lack of infrastructure and support for small recyclers. These recyclers primarily deal with mixed wet and dry waste and need to carry out washing and cleaning of the waste before it can be recycled. This results in the release of effluent and dust and debris. As small-scale recyclers do not have the financial capabilities of setting up effluent treatment plants or even install dust filters, they get blamed for creating pollution. Similar such hardships of recyclers have been addressed successfully by China’s government through the formation of recycling clusters and the provision of common effluent treatment plants. The Indian government’s Department of Science and Technology has taken up a project to see if such recycling clusters could be formed in various parts of the country where common effluent treatment plants and other facilities like laboratories can be provided.

LG: What is the mantra for successful management of plastics waste in India? How is the plastics industry in India contributing towards prevention and control of plastic litter?

VM: For efficient management of plastics waste in India, brand owners need to play an active role in the prevention and control of plastic litter. It needs to be understood that the plastics industry is not creating waste but is merely converting plastic granules to finished products as per the requirements of the customer. Like in the West, brand owners should come forward and share the responsibility of managing plastic waste and make real efforts and not mere symbolic gestures. At the same time, the government should provide adequate infrastructure so that local municipalities and other bodies can carry out waste collection in economically viable quantities and minimize excess contamination. It is unrealistic to expect the 10,000 odd plastics processors to pick plastic waste from across the country. The job of waste collection has to be done by the municipalities, gram panchayats and other local bodies. Also required are stringent waste management rules, which need to extensively communicated

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission

INDUSTRY INSIGHTS

and enforced. A consistent social campaign against litter, involvement of non-governmental organization (NGOs) and sufficient funding are also requisites for successful management of plastic waste in the country. The plastics industry in its own right is playing a responsible role by trying to spread awareness to control litter. There have been various awareness programs and workshops that have been organized by the industry in schools and housing societies in big metropolitan cities, in smaller towns and hill stations like Matheran, Darjeeling and Kalimpong and even in various places in Northeast India. For example in Matheran, which is the smallest hill station in India and an eco-sensitive zone, all sorts of waste from various packaged products used to accumulate in the valley. With the help of industry groups, NGOs, the municipal council, local shopkeepers, hoteliers and school students a cleanliness drive was conducted, wherein wheel barrows, waste collection bins, sign boards for anti-litter messages and compactor machines for crushing PET bottles were provided. At the same time, knowledge about the handling and recycling of plastic waste was communicated to the locals, civic bodies as well as the visitors. Today, Matheran is one of the cleanest hill stations in Maharashtra and this model, in which the industry joins hands with local bodies and citizens to fight litter and enhance recycling, has been replicated in various other hill stations and eco-sensitive zones across the country.

LG: What innovations have been witnessed in plastics waste management?

VM: The hierarchy of the “reduce, reuse and recycle” principle applies to plastics waste as well. In the case that mechanical recycling of plastics is not possible, there are other innovative applications in which plastic waste can serve a useful purpose; for instance, in road construction. Plastic waste when added to bitumen increases the strength properties and the life of the road. My presentation on this subject received the award for the best presentation in IdentiPlast 2007, a global conference and the plastics industry’s most important gathering on recycling and recovery of plastics. This model has been tested at various stretches in Mumbai, Bengaluru and Chennai, and the results have been phenomenal. The plastic acts as a good binder and the road does not crack or develop potholes. It is one of the pilot projects of the Indian Centre for Plastics in the Environment (ICPE), which is working on refining the model and promoting it with various municipalities. Another application is generating fuel from waste plastic that is economically challenging to recycle. By using depolymerization and pyrolytic conversion techniques, waste plastics can be converted to petroleum fuels similar to diesel and gasoline. Co-processing or using plastic waste as a source of energy, replacing natural fuels such as coal, in various industrial processes such as cement kilns is probably the last sustainable option for managing plastic waste. These are the options available for recovering the maximum possible value out of plastics waste when recycling is not possible or economically viable.

LG: What sustainable practices should be adopted by the industry to better recycling?

VM: India has a large pool of capable scientists and researchers; for example, the CSIR-Indian Institute of Petroleum (CSIR-IIP), one of the leading constituent laboratories of the Council of Scientific & Industrial Research (CSIR), undertakes research and development activities for optimum utilization of petroleum products. The industry can benefit from such professionals and their guidance should be sought for minimizing energy consumption and reducing pollution. Moreover, the industry should work together with various such laboratories informing them about the advantages and disadvantages of a particular waste product and in turn learning from them about catalysts and additives that could further optimize their processes.

LG: What are your views on the “blanket bans” and partial bans on plastic products that are proposed by the government?

VM: In India, the plastics industry is unfairly blamed for creating plastic litter and unwarranted bans are demanded on various plastic products. The authorities and lawmakers need to understand that plastics processors are not the ones creating waste and litter can be prevented and controlled like in other countries. For example, the

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission

INDUSTRY INSIGHTS

proposed ban on PET for pharmaceutical packaging applications on the basis of a report that claims that PET contains phthalates and endocrine disruptors created an unnecessary scare in the ministry and legislature despite the fact that the judiciary has already dismissed numerous such frivolous PILs against PET packaging in the past. The industry has also proved beyond doubt that PET is a universally safe and environmentally friendly packaging material and is used for pharmaceutical packaging across the world. Moreover, moving from plastics to glass or metals would be retrogressive and would result in increased cost to the society and environment.

LG: What are your thoughts on biodegradable and compostable plastics? Do you see potential for rapid growth in the bioplastics market in India?

VM: At present, the applications of bioplastics in India are limited. Biodegradable plastics essentially result in a waste of resources as the items made of biodegradable plastics are intended to be used and thrown or composted. Whereas, in the case of conventional plastics there is always the option to recycle and use it for a variety of applications. There are certain applications in which biodegradable plastics are desired; such as garbage bags and in medicine and healthcare. The market for bioplastics can benefit from more clarity about the properties of the material being used and the material should be tested as per its intended application.

LG: How is the plastics industry contributing towards Swachh Bharat Abhiyaan or Clean India Campaign advocated by Prime Minister Modi?

VM: The industry plays its part and conducts various awareness campaigns and school programmes through which the importance of plastics collection and recycling is propagated. As support for the Swachh Bharat initiative, on the 4th of October, 2015, we conducted a cleanliness and awareness drive in Mumbai in which more than 200,000

students from over 100 schools across the city participated. A record collection of 23,358.9 kg of plastic bottle waste was made within six hours thanks to the efforts of the students, their parents and teachers. This initiative was taken by the plastic industry in association with the country’s largest bottled water company and India now has surpassed the Guinness world record for maximum plastic bottle waste collection of 13,408 kg set by a school in the U.S. After the record is approved by Guinness, participation and appreciation certificates from Limca Book of Records and Guinness will be presented to the schools. This will also help India earn global recognition as a nation that

cares for the environment, in line with the Swachh Bharat Abhiyaan of Prime Minister Narendra Modi. In addition to breaking the world record on that day, audio-visual presentations were conducted in the participating schools teaching the students about plastics manufacturing and recycling processes and the importance of waste collection.

LG: What is your view on the future of the plastics industry in the prevailing low-cost oil environment?

VM: The prevailing low prices of crude oil should benefit the plastics industry and the prices of polymer commodities may fall further, translating into more applications for plastics like in the agriculture, infrastructure and housing sectors. Although the input cost has gone down, there are factors such as price protection that have prevented a proportionate fall in the prices of plastics commodities.

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission

INDUSTRY INSIGHTS

LG: Which are the governmental and non-governmental bodies that you are associated with in relation with environmental protection and sustainability? How successful are the measures that have been adopted/proposed so far?

VM: NGOs play an important role in communicating with and getting support from municipal corporations, resident welfare associations and industry bodies. Since over a decade I have been addressing issues related to environment, sustainability and recycling in India, across Asia and at times in Europe. Because of my passion for protecting the environment, I have been involved with various NGOs, policy makers, schools and government officials in addition to our own industry members and the hundreds of small recyclers. Clean Mumbai Foundation, Stree Mukti Sanghatana, Forum for Organized Resource Conservation & Enhancement (FORCE) and NAGAR are some of the major NGOs that I have worked with. Together, we have conducted numerous cleanliness and recycling projects, which have been highly successful and have been replicated in other places.

ENDS Lekhraj Ghai can be reached at +91 9967828215 and lekhraj@polymerupdate.com

POLYMERUPDATE is an online destination for the plastics and petrochemical industry, which specializes in providing market-moving information and pricing data on petrochemical products and

industrial polymers. Global players seeking polymer market intelligence rely on the real-time news and price alerts provided on POLYMERUPDATE for making informed business-critical decisions. POLYMERUPDATE covers a whole spectrum of products such as Crude oil, Naphtha, Aromatics, Olefins, Polyolefins and Petrochemical Intermediates. With almost two decades of extensive experience in garnering and providing business-critical content, POLYMERUPDATE has expanded its readership to more than 60 countries in the world and its pricing methodology is considered as a benchmark across South Asia. POLYMERUPDATE interviews and articles are a rich source of information on the latest trends in the chemical and petrochemical industry.

Visit POLYMERUPDATE on the internet at www.polymerupdate.com

October 23, 2015

POLYMERUPDATE You may not modify, copy or distribute any information contained in this document without our prior permission