“We expect momentum to pickup from H2 of this year” - The Noel D'Cunha Sunday Column

Noel Marshall D’cunha: Tough 18 months, what have you been telling your clients?
SN Venkataraman: All businesses went through a cycle of “shock – adjustment - recovery – refocus”. Our customers have navigated through a period of volatility and uncertainty and we have reached out and helped them to restart, revive and lowered their risks in every possible manner

NMD: The worst affected has been commercial printing? How, is the question on most lips?
SNV: Commercial printing will take a longer time to come out of this trough. We need schools and colleges to reopen to drive demand for stationeries and educational publishing.

NMD: Any hope or will it be total decimation?
SNV: We need a higher confidence level across industry for more spending on catalogues, brochures and flyers. While people and business have consumed more digital media in this pandemic period, we will have to see how much of this behaviour sticks on.

NMD: Good news or bad news on the education front for H2?
SNV: Many states have announced a phase-wise reopening of schools and colleges. With more vaccination and better management of public health, we should start seeing improvement

NMD: The paper industry has an extended supply chain ranging from lakhs of farmers involved in agro/farm forestry (for growing wood for the industry) and waste paper collection system to extensive transportation of raw materials and manufactured products.
SNV: The print and paper value chain is a great example of a high employment-to-capital ratio, starting from wood to the final brochure or carton. The pandemic affected this people-intensive value chain. There were disruptions due to the lockdowns and reverse migration of labour to villages. Fresh planting suffered in H1-2020. Paper and print factories faced severe challenges in complying with the health regulations and to maintain production without interruptions. Shortages and uncertainty in key inputs was a challenge during Wave-1 as was logistics. The wastepaper trade was decimated as trade came to a halt and collection is still curtailed. All of us learned to survive and pull along.

NMD: There has been some recovery in a few segments with the easing of restrictions, notably packaging paper and paperboard. Is the demand picking up? Or is it still below the pre-Covid times?
SNV: Yes. Demand has picked up in the FMCG products like packaged foods, home and personal care. Liquor is just about starting to recover. Pharma demand continues to be robust. Writing & Printing segment is yet to reach pre-Covid levels. Once there is easier mobility, we expect the QSR market to pick up and increased demand for paper cups and disposables.

NMD: What about exports? Is it providing some relief to domestic manufacturers?
SNV: Industry exports have grown exponentially during the pandemic period. Indian manufacturers were able to quickly fill in the gaps left by the Chinese and other suppliers during the pandemic. This helped offset the adverse impact on domestic demand.

NMD: For 2021-22, the growth prospects for paper and paperboard will remain intact?
SNV: Overall packaging including corrugated boxes have done well in H1. We expect this revival to continue and also see growth coming from commercial and book printing. Given the low base effect, growth in 21-22 could be double digit, if H2 revival gains momentum.

NMD: IPMA says the market will grow at 6-7% per annum in the medium term. You agree?
SNV: A 6% growth rate over the midterm for the overall paper consumption is definitely on the cards.

NMD: What is the per capita consumption of paper in India today? 13kgs? 15 kgs? More?
SNV: As per the latest reports, it’s around 14 -15 kgs in India, against a global average of 57 kgs.

NMD: The last time we met in your factory you mentioned how technology has boosted the sustainability curve. For example, tree saplings, which are disease and drought-resistant and can be grown in a variety of agro-climatic conditions with a view to aid growth.
SNV: Circularity and Renewable-ness are the two biggest advantages we in the paper and print business are blessed with. The biggest block is the false equation of natural forests and tree felling with the agri-plantations
from which our business derives its wood. We work through partners like WWF-GFTN and FSC in building sustainable and resilient supply-chains.

NMD: What the packaging converter community wants to know is, how to project this message much more aggressively on social media and news platforms?
SNV: At ITC, we actively promote our sustainability initiatives and achievements through various channels. If you visit the Linkedin page of ITC, you will find several posts/videos highlighting our efforts with the farmer community and how ITC has brought significant improvements to their livelihoods. We also educate our dealers and customers on different aspects of sustainability and encourage them to adopt and promote it further.

NMD: Paper is green …
SNV: Oh yes. Our unshakeable belief is that societal gains are maximum if we follow the principle of: Use paper wherever possible and other materials only where required.

NMD: We want to know your view on the disposal of single-use plastic plus e-waste?
SNV: We cannot wish away the challenges in SUP and E-waste disposal and under an EPR regulation, there will be costs to the end-of-life disposal in these categories.

NMD: Any R&D about barrier properties of paper? There were strides in the coating being undertaken for paper cups.
SNV: The research for innovative fibre-based solutions is an ongoing process at ITC PSPD supported by our industry partners and in-house R&D. Barriers required are at various levels starting from OGR, water /moisture resistance to multi-layer packaging for foods and personal products. They can be imparted by treating fibre, lamination with a film or by coating with an emulsion.

NMD: Low-density polyethylene (LDPE) has been used widely with paper to provide liquid barrier properties and heat seal-ability. Is this truly biodegradable and recyclable - cause the plastic coating needs to be extracted from the paper post-consumption?
SNV: Paper/Board as a part of multilayer packaging is only a small fraction. The primary purpose served by a paper cup is to serve hot/cold beverages in a hygienic and easy-to-serve and dispose manner. This requires a
barrier which is presently provided by LDPE. Paper cups with LDPE coating on disposal have to be collected, cleaned and processed in hydropulpers where the LDPE and fibre are separated and can be individually recycled.

We can recover 80% of the fibre in such paper cups. Most global regulations on packaging recognise this factor in a composite material A+B, where recovery of A, the principal element, can cross a threshold level of 70%, compared to sending a multilayer plastic packaging to a landfill or for fuel. Almost all forms of multilayer packaging involving paper have this advantage of being recycled and recoverable.

NMD: EPR (extended producer responsibility) is often cited as a necessary piece of the puzzle in addressing the current recycling challenges. While there’s growing attention to EPR for packaging and paper products in US and Europe, what’s the status in India?  
SNV: In India too, there is an increased emphasis on EPR. In June this year, the Ministry of Environment, Forest and Climate Change has issued a revised framework for EPR under the ‘Plastic Waste Management Rules
2016’. It states that the primary responsibility for collection of used multi-layered plastic packaging lies with the producers, importers and brand-owners.

NMD: Any ITC PSPD blueprint?
SNV: ITC is ‘Solid Waste Recycling Positive’ for the last 14 years in a row. ITC as a group aims to go beyond the requirements of PWM Rules to ensure that, over the next decade, 100% of our packaging is reusable, recyclable or compostable. It is also working towards establishing scalable, replicable and sustainable models of municipal solid waste management based on circular economy principles. The approach is centred around treating waste as a resource and ensuring that zero waste goes to landfill, which can be achieved only when waste is segregated at source. The initiatives focus on educating citizens on segregating waste at source into dry and wet streams and ensuring that value is derived from these resources and in the process support sustainable livelihood for waste collectors and rag-pickers. These models operate on a public-private partnership basis with active involvement of Urban Local Bodies, Civil Society and the informal sector of waste collectors.

NMD: What about the past 12 months?
SNV: In 2020-21 alone, ITC through its flagship programmes under Mission Sunehra Kal and ‘Well Being Out of Waste (WoW)’ sustainably managed more than 78,000 tonnes of dry waste, including 31,000 MT of post-consumer plastic waste. This is equivalent to more than 80% of plastic packaging films utilised by ITC during the year. In the ensuing fiscal, the endeavour would be to collect in excess of 100% of plastic packaging introduced in the market.

NMD: This year began with China banning imports of all recovered fibre. Does this impact your operations? Is there an opportunity to being in that material now available for other markets?
SNV: By far, the biggest impact through 2020-21 has been the disruption of wastepaper collection chains resulting in more scarcity. We have seen the spurt in prices of kraft papers caused by such disruptions. There have been shifts in some cases to higher usage of VAP paperboards.

NMD: At a recent webinar, there was a discussion on how sustainability will transform packaging. The speaker sighted some interesting work such as making the outer packaging in eCommerce, lighter and biodegradable.
SNV: Sustainability took the second-row seat during the pandemic but has once again moved to the front row.

NMD: Final question: Five “green” packaging products that caught your eye during the pandemic months?
SNV: I must say that our four product families of Indo, Omega, Filo and Wrapwell, take the pole position. Others which have caught my eye are the Pulpex consortium paper bottles, ITC Aashirvaad instant meals packaging in tubs/bowls, and E-commerce’s shift to paper-based pouches/fillers.