High import duty hurts plastic industry

High import duty and production cost, coupled with poor quality of power supply, lack of skilled manpower, and competition from imported plastic goods due to the open border, have hit the growth of the domestic plastic industry, according to Nepal Plastic Manufacturers' Association (NPMA).

The domestic plastic industry can grow rapidly, provided the government reduces the import duty, supports the industry in waste collection and management, and subsequently supports in establishing recycling plants, said president of the association Shailendra Lal Pradhan at an extensive seminar on 'Showcase of Plastic and Growth of its Industries', organised jointly by the association and Esskay Pvt Ltd, here today.

There are about 300 organised plastic processing units and about 200 more secondary units making it a total of 500 plastic traders in Nepal, which provide direct employment to 25,000 people and indirect employment to a similar number, he said, adding that the total investment in the plastic sector is expected to be around Rs 30 billion, contributing an annual tax of more than Rs 5 billion. "The industry also pays more than Rs 2 billion as import duty and VAT."

Despite quality production under the most advanced technology, the annual growth of the domestic market is restricted to only five per cent, the lowest in the South Asian region, said convener of the programme and MD of Esskay Pvt Ltd Sharad K Tibarewala.

"Nepal has the highest import duty on plastic products as compared to other South Asian nations," he said.

Similarly, export is hampered due to the sole dependency on India for the use of sea ports, said vice president of the association and convener of the seminar Sharad Sharma, shedding light on different aspects of the plastic industry, its growth and future perspectives in Nepal.

"The use of plastic goods is increasing in geometric ratio as it is widely used in our society, and is nothing but simply a recycling process," said participants in the second session on 'Sustainability and Environment'.

"Used plastic and its products are valuable resources and cheap to produce, and does not decompose but can instead be recycled," they said, adding that plastic has enabled numerous technological advancements, new design solutions, enhanced performance and furthered cost savings in recent times. "The production of plastic products is also not energy intensive as compared to metal, glass and paper."

The seminar will be jointly inaugurated by National Planning Commission (NPC) vice chair Deependra Bahadur Kshetry as chief guest and industry minister Anil K Jha as guest of honour tomorrow.

The seminar will also see some prominent personalities representing the major plastic companies and their associations like MD of Chevron Philips, Singapore Jim Becker and other distinguished personalities both from Nepal and abroad.

Though plastic granule as polypropylene and polyethylene was invented by Philips Petroleum, USA in 1950 AD, it was introduced in Nepal about four decades back only.

Some 150 KT of polymers are consumed annually in Nepal to produce hundreds of plastic products like household goods, bottles for packaging for oil, water, drinks, medicines, and syringes, furniture, ropes, polyester yarn, lubricants, pipes and fittings, packaging sacks, and construction materials.

The domestic industry manufactures a wide range of plastic products for both the domestic and export markets.