India: The packing sector enters a challenging phase with hike in price of raw materials

The corona crisis has sceptically strained the packaging industry including aluminium in Uttar Pradesh’s Gautam Budh Nagar district. In accordance with the entrepreneurs of the industry, the prices of essential raw materials like aluminium foil have escalated by 70% during the pandemic and freight charges of overseas nations has also increased five times high.

Kulmani Gupta, the President of the Noida chapter of Indian Industries Association (IIA), said: “At present, there are over 800 packaging units operational in Gautam Budh Nagar, providing jobs to over 20,000 people.” 

“Packaging is an integral part of many industries, including readymade garments, automotive, home appliances, electrical components, printing, grocery and handicrafts. Most raw materials, such as aluminium foil are used in this industry, are imported from other countries. After the Covid-19 outbreak, not only have the prices of raw materials go up by 70%, but overseas exporters have also increased the transportation and carrier charges fivefold since the outbreak of the pandemic (in March 2020). As a result of these issues, orders to these packaging units are suffering a huge loss,” he added.

Ashish Malhotra, an entrepreneur of an aluminium dye cast manufacturing unit in Noida, said: “The price hike in aluminium raw material has adversely affected the packaging industry in the district as well.” 

He further added: “All the electric products, home appliances and automobile products are packed in different types of aluminium sheets. The aluminium input, which used to cost INR 100 per kilogram, is now being sold at INR 178 per kilogram. The rising prices of diesel and petrol have also multiplied our problems. Not only that, even countries we import material from having increased their carrier charges.”