India’s plastics exports down 3.5% on global economic conditions and geopolitical tensions

NEW DELHI : India’s plastics exports fell 3.5% to $11.55 billion in FY24 from $11.96 billion in FY23, despite registering a positive y-o-y growth of 5.6% in March 2024 to $1.11 billion, as per Commerce Ministry.

The decline was due to muted global economic conditions, restrictive trade policies, and geopolitical tensions affecting international trade.

The figure for March 2024 represented a 5.6% growth over exports of $1.05 billion in March 2023.

The cumulative value of all of India’s merchandise exports during April 2023 to March 2024 stood at $437.1 billion, a decline of 3.1% compared with $451.1 billion during the same period last year, on account of unfavourable global economic conditions, trade policies, and geopolitical tensions affecting international trade.

Overall, while the plastic and made-up fishing nets sectors have shown resilience and growth, the decline in the cumulative value of merchandise exports highlights the larger challenges faced by India’s export sector. It underscores the need for continuous efforts to boost exports and navigate the evolving global trade landscape.

Negative growth

In March last year, most plastic products such as films and sheets, FIBC (flexible intermediate bulk container), woven sacks, woven fabrics, tarpaulin; floorcoverings, leathercloth and laminates, plastic pipes & fittings; fiberglass reinforced plastic (FRP) and composites, etc. had reported higher exports while consumer and houseware products, and writing instruments reported a negative growth in exports.

As per the data, exports of cordage, fishnets, and monofilaments witnessed a 3.7% increase in March 2024 to $26.2 million from $25.3 million in the same month last year. However, the overall trade contracted by 4.7% in FY24 to $259.8 million from $272 million.

Exports of floorcoverings, leathercloth and laminates recorded the highest 19.6% growth in FY24 to $693.7 million from $579.9 million in the last year. FRP and composites exports stood at $480.1 million, registering a growth of 12.9% in FY24 from the previous year’s fiscal trade of $425.1 million.

Miscellaneous drop

The exports of miscellaneous products and items declined by 30.8% to $715.9 million from $1031.9 million in the last fiscal year, the data showed. Miscellaneous plastic products refer to a broad category of products that do not fall into specific or well-defined categories such as plastic fasteners and hardware, custom-molded plastic components, plastic accessories for furniture or fixtures, etc.

In March 2024, the sales of syringes, catheters, cannulae, and spectacle lenses contributed to a 10.4% increase in medical plastics exports. It increased to $48.7 million from $44.1 million in the corresponding months of the previous year.

Additionally, flexible and rigid packaging items saw a 20.2% increase in exports. This increase was attributed to higher sales of plastic sacks and bags, plastic caps and closures, and other articles used for packaging or transporting goods.

Exports surge

Queries emailed to commerce secretary and commerce ministry’s spokesperson remained unanswered till press time.

India’s plastic industry experienced a significant surge in exports from December 2023 to March 2024, indicating positive growth despite fluctuating global economic conditions, said Sribash Dasmohapatra, who is executive director of the Plastics Export Promotion Council (Plexconcil), a body under the commerce ministry.

That surge reflects not only the resilience of the Indian plastics sector but also the diverse export portfolio, spanning raw materials, packaging, and consumer products, Dasmohapatra said.

“India’s plastics and linoleum industry faces significant challenges as it struggles to recover from a decline in exports. In fiscal year 2024, exports amounted to $8.08 billion, falling short of the $8.6 billion recorded in 2019. The imbalance is further compounded by the fact that imports are approximately three times the value of exports, highlighting the industry’s heavy reliance on imported raw materials,” said Ajay Srivastava, the founder of Global Trade Research Initiative (GTRI).

“This dependence underscores the urgent need for substantial investments and reforms aimed at making the sector more self-sustaining and less vulnerable to external supply shocks,” Srivastava said.