Dabur Flags High Cost, Tight Supply Of Recycled Plastic As Hurdle To Compliance

Dabur India Ltd. on Wednesday said limited supply and production capacity of recycled plastic are making it hard for companies to immediately comply with the Indian government's amended plastic waste management rules under the extended producer responsibility framework.

Speaking at the post-earnings call for the March quarter, Dabur's management noted that demand for recycled plastic far exceeds supply, and prices remain higher than existing packaging material.

Under the amended norms, companies using rigid plastic packaging must include at least 30% recycled plastic in 2025-2026, while the requirement is 10% for flexible packaging and 5% for multi-layered plastic.

If these rules are made mandatory, companies like Dabur will have no choice but to meet the minimum thresholds, the management said. However, the industry has requested the government to delay implementation until there's adequate capacity and recycled packaging becomes more affordable.

“In terms of cost, it (recycled plastic packaging) is pretty expensive,” the management said.

Dabur is also hesitant to use recycled plastic in food, beverage, and ayurvedic products, citing its positioning as a healthcare-focused company with 50–60% of its portfolio in wellness categories.

“For personal care, which makes up half of the portfolio, we can use recycled plastic,” the management added. “But even here, the high cost of existing packaging will affect gross and operating margins.”