Industry requires better leadership even in the better times to come

Is the worm turning?

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industry

The second advanced estimates released on 28 February 2018 by the Central Statistics Office suggest that the Indian economy may finally be turning around. The quarterly estimate of GDP for FY 17-18 Q3 (October to December 2017) shows that it grew by 7.2%. Also, the Q2 GDP growth estimate was revised upward slightly from 6.3 to 6.5%. Thus, in spite of 5.7% GDP growth in Q1, it seems that economic growth is improving and the CSO has upwardly revised its GDP growth estimate for FY 17-18 from 6.5% to 6.6%.

Q3 benefi ted from 8.1% growth in manufacturing and 4.1% growth in agricultural output. While manufacturing growth is understandable and seems to some extent correlate with capacity creation continuing in the packaging industry, the higher than usual growth in agriculture is signifi cant and perhaps due to a shift in crops. In any case agricultural output, as per data and estimates released by the department of agriculture cooperation and farmers welfare on 27 February 2018, is expected to exceed targets by 3 million tons in FY 17-18 and reach 277.5 million tons. This is on the back of the record production of 275 million tons in the previous year.

Key to growth is investment and in this respect, the Gross Fixed Capital Formation (GFCG) has sharply increased to 12% of GDP in Q3 from the not so good 4.7% of GDP growth of GFCG in Q2. While the first advance estimate showed GFCG falling from 29.5% of GDP in FY 16-17 to 29% in FY17-18, the second advance estimate indicates a reversal in this trend. The second advance estimate has upwardly revised both the FY16-17 GFCG growth figure to 31.1% of GDP and the FY17-18 GFCG fi gure to 31.4%.

Setbacks to the economy’s turnaround are still possible and subject to factors such as crude oil prices rising although the news that the US is continuing to increase its domestic oil production should obviate or moderate this possibility. The deficient rainfall this winter and the possibility of a poor monsoon could be another factor as could the government’s inability to meet fiscal targets it set for itself or even inflation that could go out of hand in the run up to the 2019 election.

For the packaging industry that continued to invest in capital equipment even in the past two years of disruption and slowdown, there is of course the negative possibility of irrational legislation on plastic waste recycling or its irrational implementation and execution. However, as this industry seems poised to grow with major projects coming into production and others under construction, the prudent path would be for the packaging industry to more seriously engage with the government’s scientists, bureaucrats and institutions rather than only its politicians. This requires coherent industry leadership that looks across segments, technologies and materials instead of each segment or company individually and merely looking at the fast growing economy as its own personal milch cow.

The impact, resilience, and growth of responsible packaging in a wide region are daily chronicled by Packaging South Asia.

A multi-channel B2B publication and digital platform such as Packaging South Asia is always aware of the prospect of new beginnings and renewal. Its 16-year-old print monthly, based in New Delhi, India has demonstrated its commitment to progress and growth. The Indian and Asian packaging industries have shown resilience in the face of ongoing challenges over the past three years.

As we present our publishing plan for 2023, India’s real GDP growth for the financial year ending 31 March 2023 will reach 6.3%. Packaging industry growth has exceeded GDP growth even when allowing for inflation in the past three years.

The capacity for flexible film manufacturing in India increased by 33% over the past three years. With orders in place, we expect another 33% capacity addition from 2023 to 2025. Capacities in monocartons, corrugation, aseptic liquid packaging, and labels have grown similarly. The numbers are positive for most of the economies in the region – our platform increasingly reaches and influences these.

Even given the disruptions of supply chains, raw material prices, and the challenge of responsible and sustainable packaging, packaging in all its creative forms and purposes has significant headroom to grow in India and Asia. Our context and coverage engulf the entire packaging supply chain – from concept to shelf and further – to waste collection and recycling. We target brand owners, product managers, raw material suppliers, packaging designers and converters, and recyclers.

In an admittedly fragmented and textured terrain, this is the right time to plan your participation and marketing support communication – in our impactful and highly targeted business platform. Tell us what you need. Speak and write to our editorial and advertising teams! For advertisement ads1@ippgroup.in , for editorial info@ippgroup.in and for subscriptions subscription@ippgroup.in

– Naresh Khanna

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Editor of Indian Printer and Publisher since 1979 and Packaging South Asia since 2007. Trained as an offset printer and IBM 360 computer programmer. Active in the movement to implement Indian scripts for computer-aided typesetting. Worked as a consultant and trainer to the Indian print and newspaper industry. Visiting faculty of IDC at IIT Powai in the 1990s. Also founder of IPP Services, Training and Research and has worked as its principal industry researcher since 1999. Author of book: Miracle of Indian Democracy.

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