Paper, Packaging & Plastics
Packaging currently stands as the fifth largest sector in the Indian economy, reflecting its pivotal role in driving industrial growth and innovation. With an annual growth rate of 22-25%, the industry has become a preferred hub for packaging solutions, bolstered by advancements in technology and infrastructure. Notably, the industry boasts a robust structural framework, comprising over 900 paper units with an installed capacity of nearly 4,990 thousand tons.
Furthermore, India is home to 861 paper mills, with 526 operational units, showcasing the nation's significant capacity for paper and paperboard production. In response to global sustainability imperatives, the packaging industry in India is undergoing a paradigm shift towards eco-friendly practices and materials. Government initiatives aimed at minimizing plastic packaging and promoting sustainable manufacturing methods are driving industry-wide transformation.
Additionally, the industry's focus on food safety and quality aligns with the burgeoning food processing sector, amplifying demand for innovative packaging solutions. The expansion of the middle class, enhancements in supply chain infrastructure, and the rise of e-commerce platforms are primary factors driving the packaging industry's growth trajectory.
Furthermore, the increasing market size of packed food products, projected to reach US$ 3.4 billion by 2027, underscores the industry's pivotal role in supporting diverse sectors. As the industry continues to evolve, leveraging technological innovations and sustainable practices, it is poised to contribute significantly to India's economic landscape.
The fastest growing packaging segments are laminates and flexible packaging, especially PET and woven sacks.
The Indian packaging industry has made a mark with its exports that comprise flattened cans, printed sheets and components, crown cork, lug caps, plastic film laminates, craft paper, paper board and packaging machinery, while the imports include tinplate, coating and lining compounds and others.
Over the last few years Packaging Industry is an important sector driving technology and innovation growth in the country and adding value to the various manufacturing sectors including agriculture and FMCG segments.
Growth in this sector is primarily driven by factors like growing pharmaceutical, food processing, manufacturing industry, FMCG, healthcare sector and ancillary in the emerging economies like China, India, Brazil, Russia and few other East European countries.
Indian paper industry remains largely a fragmented sector. It consists of small, medium and large paper mills, having production ranging from 5 to 2000 Tonnes per day.
India is a net exporter of packaging products and the largest exporter of sub-segments— Biaxially-oriented Polyethylene Terephthalate (BOPET) & Flexible Intermediate Bulk Container (FIBC).
100% FDI is permitted under the automatic route in Paper & Packaging industries in India.
In term of value, US$ 3179.24 million of paper, paperboard & newsprint was exported in 2021-22, as against US$ 1940.94 million in the previous year. This added nearly US$ 1238.30 million (63% growth) in the nation growth.
It has been recorded that most of the new green or brown field projects are coming in Packaging Grade Sector and most of them are based on Recycled Fibre, hence, total share of RCF paper-based mills are exponentially increasing.
70% paper and board is contributed by non-wood sectors of the Industry
- India's paper, packaging, and plastics exports to the Gulf Cooperation Council (GCC) nations have seen strong growth. The UAE, Saudi Arabia, and Qatar are the primary importers of Indian packaging products, driven by the rise in e-commerce, construction, and infrastructure activities. In 2024, exports to the Gulf region reached USD 2.3 billion, driven by increasing demand for paper-based packaging and technical textiles used in construction. The region’s growing commitment to sustainability has also increased demand for eco-friendly packaging solutions, reinforcing India’s market position in the sector
- In the CIS region, including countries like Russia and Kazakhstan, India has strengthened its export presence in paper, packaging, and plastics. The demand for durable and affordable packaging materials, particularly paper and plastics for the retail and construction sectors, has been increasing. In 2024, India's paper, packaging, and plastics exports to the CIS countries amounted to USD 1.1 billion. As the region's industrial base expands, the demand for technical packaging and plastic materials continues to grow, benefiting Indian exporters. India is also focusing on enhancing its market presence by establishing better trade relations and offering competitive pricing.
- The European market remains one of India’s largest for paper, packaging, and plastics. In 2024, India’s exports to Europe totaled USD 3.4 billion, driven by demand from countries like Germany, France, and Italy. The European Union's strong commitment to sustainability and the shift away from single-use plastics have bolstered the demand for paper-based packaging and eco-friendly alternatives. India’s focus on sustainable packaging and compliance with European regulations has allowed it to take advantage of these growing trends. The Indian government’s initiatives to support recyclable packaging products have positioned India as a leader in meeting Europe's environmental goals.
- The United States of America continues to be one of the largest markets for Indian paper, packaging, and plastics products. In 2024, India’s exports to the U.S. in this sector reached USD 2.8 billion. The demand for eco-friendly packaging materials, particularly in the e-commerce, food, and beverage sectors, has been a major driver. Additionally, the preference for high-quality, sustainable packaging products has led to a further expansion of Indian exports. The U.S. market’s strong focus on sustainability has supported India’s growth in providing recyclable and biodegradable packaging options, meeting the evolving consumer and regulatory needs.
- India’s paper, packaging, and plastics sector has witnessed rapid growth in the Asia-Pacific region. Countries like China, Japan, and South Korea are among the major importers of Indian products, with demand increasing due to the region's expanding retail and industrial sectors. Exports to the Asia-Pacific region reached USD 1.6 billion in 2024, driven by the growing demand for paper-based packaging, particularly in the food and beverage, electronics, and e-commerce sectors. India is focusing on offering affordable yet sustainable packaging solutions to cater to the growing markets in Southeast Asia.
- India’s exports to Africa in the paper, packaging, and plastics sector have been steadily increasing, reaching USD 1.2 billion in 2024. Key markets like Kenya, South Africa, and Egypt have been significant importers of Indian products. Demand for affordable, high-quality packaging materials in Africa’s retail and manufacturing sectors continues to grow. India is expanding its footprint in Africa by offering skill development programs in packaging and plastics manufacturing, thus increasing its presence in the region’s growing market.
Looking towards 2025, India aims to further solidify its position as a leading player in the paper, packaging, and plastics industries. The Indian government is focusing on promoting sustainable packaging solutions through initiatives such as the Pradhan Mantri Formalization of Micro Food Processing Enterprises (PMFME) scheme. The Indian industry is expected to capitalize on the global shift towards eco-friendly packaging materials, with innovations in biodegradable plastics and paper-based products playing a key role in growth. By 2025, India plans to increase its production capacity for recyclable and biodegradable materials, ensuring that it meets the global demand for sustainable packaging solutions.
India is also exploring new technologies such as digital printing and smart packaging to remain competitive in the global market. Strengthening trade ties with key regions like Europe, the U.S., and the Gulf, along with a continued focus on sustainable practices, will drive India's paper, packaging, and plastics exports in the coming years.