Registration/Compliances Required to Set up PET Bottles Production

Narendra Kumar

19 Oct, 2019

PET and Advantages of Using PET Bottles

PET is the abbreviated form for Polyethylene Terephthalate. It is a thermoplastic polymer, can be opaque or transparent and is produced from petroleum hydrocarbons. In order to make PET bottles the plastic is polymerized in which shorter molecules are linked together to form long molecule chains.

This material is considered ideal for packaging soft drinks^[1], mineral water, edible oil, butter, mayonnaise, syrups, sauce, jam, squash, and even pharmaceutical products. Since the polymer is now becoming the preferred packaging material in the food and medicinal industry, and even the Indian government has come out with industry-friendly policies, this industry is bound to grow.

There are several reasons for preferring the PET bottles to the glass bottles, some of which are:-

1. PET bottles are more durable and breakage-resistant as compared to their glass counterparts. It is because of their tough non-reactive composition that prevents the creation of moisture and air; there are lesser chances of leakage and bursting while shipping from one place to another, thereby maintaining the quality of the liquid inside.
2. They are flexible enough to be molded into any shape and any shade of color.
3. It consumes lesser power to manufacture PET bottles compared to glass containers. Also since plastic is lighter, the transportation costs involved are lesser.
4. These bottles can be recycled after first use. They can be used for as planters, for drip irrigation, used in making carpet fibers, pillow stuffing, etc.

What is the Market Dynamics of the Industry in India Today?

The demand for PET bottles is on the move as is apparent from the figures below:-

• As per a study conducted by Euromonitor, in 2016, the total production of PET bottles all over the world was 485 billion bottles. By 2021 it is expected to increase to 583.3 billion bottles worldwide.
• The study also reveals that in 2017, about one million plastic bottles were sold every minute worldwide.
• PET manufacturing capacity in India in 2014-15 was 982 Kilotons (KT) which rose to 1458 KT in 2015-16. The consumption too saw an increase from 774 KT in 2014-15 to 907 KT in 2015-16. Exports form a very important part of this industry. In 2015-16 about 650 KT of PET was exported to countries like Bangladesh, the USA, Italy, Israel, etc.
• The per capita consumption of plastic is low in India – against a per capita consumption of 109 kg in the US in 2015, India stood at 11kg consumption. Hence there is immense potential for the growing demand in the domestic market.

The above statistics are encouraging and point towards a positive growth trend. Investing in a PET bottle production is, hence, a lucrative proposition in India.

What are the Mandatory Licenses and Compliances that are Required for PET Bottle Production in India?

The following registrations and licenses are mandatory to start operation:-

1. Company Registration for the business with Registrar of Companies
2. Obtain a trade license from the local municipal body for operating the business
3. Udyog Aadhaar MSME registration
4. GST Registration is mandatory for all businesses that earn more than INR 20 lakh per annum.
5. Factory license under the Factories Act 1948
6. Certificate of enrolment for professional tax
7. No-objection certificate from the State Pollution Control Board
8. ISI certification from the Bureau of Indian Standards that mention the specific process of manufacture of the bottle and that the manufacturer shall follow the good manufacturing practice so that the bottles are free from any burnt, oxidized or un-homogenized particles, are clear and transparent and free of any scratches, leakage, cracks or permanent buckling.
9. FSSAI license – The Food Safety and Standards Association of India lays down rules for all packaging items related to Food & Beverages. As per the regulation all liquid items meant for human consumption, especially water should be packed in clean, hygienic, colorless, transparent and non-tampered bottles/containers that are made of following articles:

• PE (Polyethylene) material that needs to comply with IS:10146
• PET and PBT material compliant with IS: 12252

The plastic packaging materials need to pass the standardize migration and color migration limits to be produced on a large-scale and used for the packaging of edible items.