OVERVIEW ON INDIAN PLASTIC INDUSTRY NOVEMBER 2008 1

PRESENTATION OUTLINE • ABOUT PLASTINDIA FOUNDATION • CURRENT TRENDS & DEVELOPMENST IN THE INDIAN PLASTICS MARKET • WHY INDIA • INVESTMENT AND JV OPPORTUNITIES • OVERVIEW OF PLASTINDIA 2009 TRADE SHOW – DESTINATION INDIA 2

ABOUT PLASTINDIA FOUNDATION 3

PLASTINDIA FOUNDATION - BACKGROUND • Apex body of major associations, organisations and institutions connected with plastics. • Objective to promote the development of plastics industry. • Assists the growth of plastics and related materials and their products. • Dedicated to the national progress through plastics. • The Founder Member Associations of Plastindia Foundation cater to 55, 000 units of the plastic industry. 4

PLASTINDIA – FOUNDER MEMBERS Founder Members Activity Email & Website The All India Plastics Manufacturers Association – Mumbai Raw Material, Machinery, Processors, Mold & Dies, etc. aipma@vsnl. com www. aipma. net Organisation of Plastics Processors of Processors India – Mumbai oppi@vsnl. com Indian Plastics Institute – Mumbai Education & Technical Consultancy ipi@bom 3. vsnl. net. in Processors & Machinery ipf@cal 2. vsnl. net. in Indian Plastics Federation – Kolkata www. oppindia. org www. Inplasin. org www. plasticfederation. org Gujarat State Plastic Manufacturers Association – Ahmedabad Processors & Machinery The Plastics Export Promotion Council – Mumbai Exports Central Institute of Plastics Engineering & Technology – Chennai Technical and Educational Institution gspma@icenet. net www. gspma. org plexconcil@vsnl. com www. plexconcil. org cipethq@md 3. vsnl. net. in www. cipetindia. com 5

PLASTINDIA - CHARTER • Facilitating export led growth of the Indian plastic industry. • Help doubling plastics processing capacity & consumption by 2012. • Make India the third largest consumer of polymers in the world. • Make India a preferred sourcing base of plastic products in the world. • 35% of our production should be exported by each and every processor / converter. • Showcasing Indian plastic industry to the world by participating in shows. • Promote and boost export business volumes and revenues. 6

PLASTINDIA - CHARTER contd… • Facilitating setting-up of product design centres at institutes. • To support technical institutes to help increase technically qualified man-power available to the industry, for meeting demands. • Project an appropriate and progressive image of ‘Brand India’. • Help conserve energy, scarce materials, natural resources & protect the environment. Promote scientific recycling of plastics. • Encourage co-operation amongst related organisations & institutions. • Encourage use of plasticulture techniques for improvements in agriculture, horticultural & floricultural sectors. 7

INDIAN PLASTICS INDUSTRY 8

FAVOURABLE PETROCHEMICAL POLICY • New approach and initiatives ensure Govt. of India support to the Plastic Industry • Release of the book on ‘National Policy On Petrochemicals’ by Hon’ble Minister for Chemicals, Fertilizers & Steel Mr. Ram Vilas Paswan & by Mr. B. K. Handique, Hon’ble Minister of State for Chemicals, Fertilizers and Parliamentary Affairs was a great mile stone for the growth of the Indian Plastic Industry. • It will facilitate increase of scales of operation with use of advance of technology. • Plastic industry in India is on a defined path of abundant opportunities with release of this policy. 9

SOUND & SOLID FOUNDATION • Growth rate: 12% - 15%. • Contribution to the exchequer: US $ 1. 8 billion. Potential to increase if exports touch 1/3 rd of production. Of course this could be possible if central excise duty is reduced from 14% to 8% is effected. • Per capita consumption of 6 kg set to double in the next 3 years. • Exports growth rate: 21% p. a. 10

SOUND & SOLID FOUNDATION contd… • Today the export value of plastic goods stands at approx. USD 3. 6 billion. • Capacity of polymers – 4. 6 millions tonnes, to be enhanced by 2 million tonnes by 2011. • In 2007 – the processing capacity had increased by one million. • The short to long term target of the industry is to be on par with the world average per capita consumption of 27 kgs. with the use of latest technology. 11

POLYMER INDUSTRY CONSUMPTION (2010) China India 16. 6 3. 3 8. 1% 14. 1% 38. 8 12. 5 ((3 3 rdrd)) (10 th) 2000 (MMT) 2010 (MMT) India to be 3 rd largest polymer consumer by 2010 12

PACKAGING: 50% of PLASTIC CONSUMPTION Indian Plastics Packaging Demand (Mn. Tonnes) 2002 Flexible Packaging 2010 Growth 1 3 12% Woven Sacks / Multi filaments 0. 5 1. 4 12% Rigid Packaging 0. 5 1. 8 14% 2 6. 2 12% Total 13

PLASTICS IN TRANSPORTATION • Production base for all major auto manufacturers • US $ 8 billion auto industry • 5. 6 million production capacity • Emerging global production base • Will provide the necessary impetus to polymer consumption, from 43 KTA (in 2002) to 150 KTA (in 2010) 14

INDIAN PLASTIC GOODS EXPORTS Moulded, Soft Luggage Items 3 % Ropes, Twines, Yan, Bristle 2 % Floor Coverings 2 % Electrical accessories 1 % Fishnet, Fishing Lines 2 % PVC Pipes, Fittings 2 % PVC Sheeting, Film 1 % PVC Fabricated Goods 0. 47% PVC Leather Cloth 4 % Toys, Games, Dolls 0. 44% 15

PROVEN PRODUCTS, QUALITY PEOPLE • Exporting to 157 countries in Europe, North & South America, Middle East, Africa, CIS/Russia etc. • Products categories are covered by HS codes – 3917 to 3926 & 9608. • For dies & moulds – exporting to 112 countries covered under HS codes – 848071 & 848079 respectively. • Technical training for plastics professionals by CIPET. 16

MAJOR THRUST AREAS • Packaging • Infrastructure • Automobiles • Agriculture • Consumer Goods • Healthcare • Conservation of Resources 17

EXPORT THRUST AREAS Plastic Moulded Extruded Goods PVC Fabricated Goods Polyester Film Master Batches Plastic Woven Sacks/Fabrics/Bags (Raffia) PP-PVC Compounds Writing Instruments Plastic Bangles, Imitation Jewellery Ropes, Twines, Yarn, Bristles Moulded Soft Luggage items Fish Nets, Fishing Line Lenses Toys, Dolls, Games GRP, FRP Products Plastic Raw Materials Plastic Elec. Accessories Laminates Poly-Lined Jute Goods Floor Coverings Optical Goods PVC Leather Cloth Garbage and Shopping Bags PVC Rigid, Flexible Pipes, Fitting Pick-up Bags PVC Sheeting, Film Furniture, Chairs, Tables, etc. 18

PLASTICS PRODUCT EXPORT Value in USD Million Product April'06 -March'07 April'07 – March'08 Plastic raw materials 1922. 73 1930. 73 Plastic Moulded Extruded Goods 619. 32 702. 59 Polyester Film 118. 38 121. 45 Plastic Woven Sacks/Fabrics/Bags 168. 12 240. 67 Human Hair/Human Hair products 87. 2 180. 37 Writing Instruments 52. 51 83. 51 Laminates 38. 71 53. 91 Moulded/Soft luggage items 31. 35 35. 91 Hard Resilene Lenses 9. 64 10. 87 PVC Leather Cloth/Foam Leather 22. 91 23. 48 Source : The Plastics Export Promotional Council, Mumbai 19

DIRECTION OF INDIAN PLASTICS EXPORT Value in USD Million Country 2007 -2008 2006 -2007 USA 310. 54 246. 25 China 223. 14 438. 98 UK 159. 24 108. 92 UAE 110. 73 146. 31 Netherlands 69. 89 40. 83 Spain 66. 33 48. 45 Italy 63. 9 115. 41 Saudi Arabia 62. 06 49. 78 Belgium 62. 86 52. 05 Germany 55. 08 34. 63 Source : The Plastics Export Promotional Council, Mumbai 20

MACHINES REQUIRED BY 2015 2004 2015 34, 100 68, 615 34, 515 6 Blow Moulding 5, 300 16, 028 10, 728 10 Monolayer Film 5, 150 12, 728 7, 578 8 Multilayer Film 565 3, 698 3, 133 18 Woven Sacks m/c 1, 100 1, 994 894 5 PP/PE Pipes Plant 540 1, 334 794 8 1, 460 2, 646 1, 186 5 68 185 117 9 Total -- 58, 945 Injection Moulding TQ PP Film Plant Fibre & Filaments Additions CARG % Source: Plastindia survey 21

KEY GROWTH SECTORS Polymers Demand (kt) Potential by 2010 Sector Packaging 6, 200 Infrastructure 2, 500 Agriculture 1, 500 Consumer Goods 500 Other Moulding 940 Health Care 160 Conservation of Resources 300 Total 12, 100 tupendous growth in all sectors, key sectors as below 22

FIBC MARKETS US FIBC Consumption : 190 KT Domestic Prodn 17% Others 1% Canada Thailand 1% 7% Mexico 31% Turkey 25% China 5% India 10% Indonesia 3% 23

WHY INDIA? 24

FAVOURABLE OVERALL BUSINESS ENVIRONMENT • Established democracy and stable government. • Judiciary of high international standards. • Speedy reforms in legal framework for industry & business. • Setting up of SEZs to overcome bottlenecks of infrastructure and create business friendly policies. • Abundant technically skilled manpower. • Large and growing captive market. • Favourable Government initiatives and policies. 25

WELL POSITIONED PLASTICS EXPORTS • India - The emerging global sourcing hub for plastics. • Plastics Export Promotion Council of India, a founder member of Plastindia Foundation, is actively promoting exports of plastics products from India. • Exports for year 2007 -2008: US$ 3. 6 billion. • Target for year 2008 -09: US$ 4. 3 billion. • Wide spectrum of scales of manufacturing. • Competitive advantages. • All leading countries import from India. 26

COMPARATIVE WAGES: DISTINCT ADVANTAGE Wages is USD for a Mc. Donald’s Cashier 27

INFRASTRUCTURE INDIA – ROAD & RAILWAYS India has one of the largest road and rail networks in the world. Road • 3. 3 million kms of road. • Road network being upgraded across the country. Rail • 63, 140 kms of rail. • Railways run 4000 cargo trains daily. • Annually, transport over 5 billion passengers and over 350 million tonnes of cargo. • Work force of 1. 54 million. Source: National Highway Authority of India 28

INFRASTRUCTURE – PORTS & AIRPORTS Ports • India has a coastline of almost 7500 kilometres. • There are 12 major ports and 187 minor and intermediate ports. Airports • India has 126 airports in total. • Facilities at most of the airports are being upgraded • Over 10 domestic airlines flew 59. 3 million passengers in 2004 -05. 29

LOW COST OF LIVING • Adequate and affordable public transportation. • Well-developed residential areas. • Reasonable food prices. • Good quality & low cost healthcare. • Excellent educational facilities. 30

OPPORTUNITIES GALORE India can be amongst the largest polymer processing hub by 2012 • India – A haven for out sourcing • Overall low cost structure • Paradigm shift in the downstream processing industry • Consolidation of fragmented capacities • FDI in the downstream processing industry • Technology upgradation • Strategic location : Efficient utilisation of the vast coast line and ports. 31

INVESTMENT & JV OPPORTUNITIES 32

SEZ’s IN INDIA AND BENEFITS TO INVESTORS • Readymade and upgrading of infrastructure and ensuring uninterrupted and cheap power to investors at the SEZ. • Investors will be able to own 100% of downstream assets at the site. • The fiscal benefits in SEZ include: • Customs and excise duty exemption on purchase of all capital goods, raw materials and spares. • Domestic procurement of goods for development, operation and maintenance. • A 100 per cent income-tax umbrella for the five years. 33

MORE ON SEZ’s • 50 % tax exemption for the next five years and 50% of the ploughed back export profit for the next five years. • Full income tax exemption on export profits for the first five years and 50% for the next five years. • Exemption from service tax at construction stage, and no duty on project imports. • Also offered are exemption from minimum alternate, and sale taxes. 34

JV FRIENDLY ENVIRONMENT IN INDIA • Plastindia Foundation has been organizing summits in association with plastic industry associations worldwide to enhance mutual co -operation, appoint agents and enter into joint ventures. • Healthy democracy, minimal bureaucracy. • Business process transparency. • Import taxes at par with developing countries i. e. just 5 – 10 %. • Genuine government commitments to growth (double digit growth rates for the past decade) • Overall, progressive policies, growth friendly environment. 35

PROCESSING INDUSTRY: GLOBALLY COMPETITIVE • Sophisticated higher capacity machines. • Enhance design capabilities, technological know-how. • Intelligent manufacturing. • Global practices in production, quality & design. • Innovation, technology & consultancy • Export base (EOU’s). • FDI in the downstream sector. • Upcoming petrochemical SEZs. 36

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TOP 4 COUNTRYWISE EXPORT TRENDS With each of these 4 countries, current exports is over USD 100 Million Value (USD Million), Source: Plastics Export Promotion Council, Mumbai 38

SNAPSHOT OF U. K PLASTICS INDUSTRY • Plastics - a 17. 5 billion Pounds industry. • Total value of processing sector – 12. 4 billion Pounds. • U. K. plastic processors consume 4800 ktonnes of material • UK is one of the top 5 processors of plastics in the EU with about 4. 8 million tonnes of materials processed here. • Key strength: Plastic Packaging Innovation 39

OVERVIEW OF PLASTINDIA 2009 TRADE SHOW DESTINATION INDIA 40

PLASTINDIA 2009 Online Space Booking Already Commenced ! Unprecedented Response! Ensure, you are there by Logging on to: www. plastindia. org Concurrent Event SOURCE FROM INDIA – PRODUCTS 41

WHY PLASTINDIA 2009 • Largest exhibition in India, 7 th in its series • Globally, next to the K-Fair • Internationally recognised, with over 40 participating countries • • Varied concurrent events to address key issues and serve niches Other premium display segments at the exhibition will be: – – – – • Engineering Components White Goods Construction Articles Railway Articles Packaging Furniture Healthcare Rotomoulded / Blow Moulded Products Finally, global convergence at Plastindia 2009 42

WHY PLASTINDIA 2009 • The forthcoming 7 th International Plastics PI 2009 Exhibition would be one of the biggest shows in the world. • About 1500 exhibitors, of which 1100 domestic exhibitors & 400 overseas exhibitors from 40 participating countries would be exhibiting their wares in a gross area covering 75000 sq. mts. • Over 100, 000 visitors from world-over are expected to visit the show. • This growth is singularly due to the enormous support extended by the members of the plastics industry and a business environment created assiduously by the Government of India alongwith the state governments all over the country for the international community to feel at home. 43

PLASTINDIA 2009: SUSTAINED MONENTUM Gross Exhibition Area (sq. m. ) Expected area in Plastindia 2009, 75000 sq. m. 44

PLASTINDIA 2009 – SUMMITS & CONFERENCES India – China Plastics Industry Summit 2009 February 3, 2009 (Business Opportunities and Trade Complementation) India – USA Plastics Industry Summit 2009 February 5, 2009 (Strategic Co-operation, Market Sharing & Trade Complementation) A Two Day International Business Conference February 6 & 7, 2009 A One Day Asian Recycling Conference To be held concurrently during PLASTINDIA 2009 Exhibition 45

INDIA UNPLUGGED India can be your next growth partner country in the Plastic Industry. Visit and Explore To seize the immense opportunities 46

THANK YOU SEE YOU AT PLASTINDIA 2009 47