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Plastic ban to hit sachet makers
MUMBAI, FEB 9 (AGENCIES):
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Published on 9 Feb. 2011 11:32 PM IST
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The notification by the environment ministry to ban the use of plastics for packaging gutka and pan masala from March 1 will have a major impact on manufacturers of such products as sachets or small pouches comprise nearly 80% of the total volume consumed. The bulk of the consumption of gutka and pan masala takes place “on-the-go” from pan-bidi shops.
“We have just received the notification. We are consulting with other companies in the industry to present our case to the ministry,’’ an industry official told TOI on the condition of anonymity. Environment minister Jairam Ramesh on Monday said it was impractical to impose a blanket ban on the use of plastic across the country.
Despite repeated attempts, top officials of companies like Kothari Group, the makers of Pan Parag, were not available for comments. Rasiklal Dhariwal, chairman, Manikchand Group, on the other hand, did not wish to comment on the matter immediately.
According to industry experts, the chewing tobacco/pan masala industry is awaiting clarity from the government on the substitute raw material which could be used as packaging material instead of plastic.
The industry’s concern is that the product will expire sooner if stocked in paper or cardboard, making this option unviable.
Laminate packaging lengthens the shelf-life of a product and is thus used across sectors like FMCG and foods.
The impact of the ban will be felt on some suppliers of laminates as well. In the case of gutka and pan masala, the suppliers are largely in the unorganized domain. Nearly 30-35% of laminates go towards gutka/pan masala packaging. “We make plastic films which we supply to laminate producers. We will be indirectly impacted to the extent of 2-2.5% of the total revenue of Rs.3,500 crore,” said R K Jain, group president (finance), Uflex, which is listed on the BSE.
The company said it would look at the possibility of routing this supply to other applications to negate the impact. Vijay Merchant, member, Enviroplast said the total percentage of polymer consumption going towards gutka would be in single-digits (about 3-5%).
The ban would also have an impact on pan-bidi shops which stock tobacco products, even though most of the shops now have a diverse portfolio of stock candies, biscuits, chocolates, shampoo sachets, revenue stamps and stationery as well.
“The larger pan-bidi shops which stock more than 120 SKUs (stock keeping units) will not be impacted,” said an industry analyst.
As per industry estimates, there are 3 million pan-bidi shops across India. While most of the shops in urban markets would have a diversified portfolio, those in rural markets are likely to be less diversified.
There are around 15-17 manufacturers of gutka, pan masala and chewing tobacco in India and the size of the sector is estimated at Rs.10,000 crore.
Pan Parag, Goa, Baba, Tulsi and Rajnigandha are some of the leading brands in the sector.

 
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