With glass packaging coming to fore as a viable option for plastic, AGI Glaspac is continuing its expansions even during the pandemic. The packaging manufacturer has invested consistently in innovation and R&D last year during pandemic and has recently invested in its facility located in Telengana. In an email interaction with Pushkar Oak, Rajesh Khosla, President & CEO, AGI Glaspac, delves into glass packaging scenario in India. Excerpts:
Tell us about your recent investment in Telengana?
We have invested Rs 55 crore to build a new furnace of 154 TPD for AGI Speciality Glass Division at our Bhongir plant based in Telangana. This is part of the recent investment raised by AGI Glaspac from its parent company HSIL Limited, amounting to Rs 220 crore. With the new furnace, the company's Bhongir plant will be able to produce 154 tonne of premium flint and other colours. AGI Glaspac has collaborated with Germany-based HORN Glass Industries AG for this technology.
This high-quality speciality glass will cater to industries such as carbonated water, sparkling wine, pharmaceuticals and cosmetics. Our investment in German technology is aimed at strengthening our units to make our products more efficiently out of India for the global market. We thrive by the Make in India concept, and it is important that we do not miss out on the great opportunities or technologies that are readily available.
Comment on of glass packaging industry scenario in India?
The packaging industry was doing much better during and after the pandemic rather than the other sectors in the economy. Significance of hygiene and fall in dependence of people on outside food has impacted bulk purchases by hotels and restaurants which inturn has transformed into household purchases wherein people go and pick-up in smaller volumes as per their household requirement. This creates demand for packaging. The hygiene sector has become very important. Most of the people prefer cooking at home so the packaging industry has become very prominent and the pandemic did not hit the industry much rather it helped the industry in a better way.
Glass packaging has been a good demand in the food segment. Compared to 2019, food segment is doing wonderfully well, liquors and beverages are also doing reasonably well. The demand of glass packaging in food segment, beer segment and liquor segment and in other segments is high these days. However, the recycling ratio has come down. The older glass which people consume they come back to us for re-melting now people are not disposing it in right way, so our scrap collection has come down drastically. Earlier, it used to be 40 per cent on India basis which has come down to 30 per cent now.
What are the challenges in the packaging sector?
The recycle glass is not widely available. Customers are unable to forecast their demand as they are not sure about how the economy is going. Covid situation, lockdown, sanitation because of this there was no demand forecast by the customers. Even at the supplier’s end, there were transport hurdle, the small suppliers were not able to start their factory so supply chain was drastically affected. Some states again went into lockdown impacting more challenges to procure material for recycling.
Share some key trend that you have observed.
Glass industry is highly technical and automated industry. With the new IoT business scenario, we are not only automating each and every part we are also digitalising the machineries. Optimisation is a new thing which is used drastically and we are also planning to use it widely in all our areas.
What industries will be at focus in the coming fiscal and does AGI Glaspac expansion plans?
We will be more focused into beer, food and pharmaceutical segments. We are importing raw materials and series of equipment and machinery to produce good quality products. We are also exporting food grade packaging material and pharmaceutical packaging material in various part of the world. We aim to strengthen supply to USA, Africa and other places in the coming fiscal.
We had announced a significant geographical expansion with an estimated investment of Rs 700 crore in the eastern part of India. The project is currently on hold due to the pandemic. We may start it this year. The project is about glass containers in eastern part of India.
Tell us about hurdles in imports and also share your thought on glass packaging industry in India?
Right now, in India, the consumption of glass manufacturing is poor. We are 5-6 times lower than China. Transportation and shipping challenges were there. Now, things are getting back to normal. Looking at imports, glass packaging relies heavily on importing machinery and equipment form Germany, Italy, Spain, USA as glass packaging operates on strict regulations and norms.
Looking at the current market and reforms in healthcare and pharmaceuticals, glass packaging will see a rise. Further, acrylic industry may pose a threat to glass as its more durable buy me encounter migration or losing forms when subjected to higher temperature. Glass is not a hazard rather it can be recycled. There is a need to streamline used glass for recycling. We need to move towards 60 per cent from the current recovery of just 40 per cent, which is currently low in pandemic.
What impact does input costs have on MSME sector?
The last Budget focused on promoting domestic manufacturing that benefits the MSME sector, but the input cost increase is putting a lot of pressure on the small and mid-size businesses. There is a need to address the rising cost of inputs in the form of steel, iron, copper, and other metals which has become a matter of grave concern for the sector. Input costs have gone up which in turn had thrown many small players out of the market.
To overcome this hurdle, the government can also cut or waive off duty and tariff rates to increase MSME exports. This can be encouraged by R&D incentives and helping small industries with a workable plan for tech upgradation.
Share with us some of your recent achievements?
AGI glaspac, has pioneered in innovation of antibacterial range of food storage glass jars and bottles, through its retail segment Greendrop Glassware. These antibacterial jars and water bottles are infused with ‘Germ Guard Technology’. This new line of product will be available for sale on all the leading e-commerce sites like Amazon, Flipkart, Snapdeal and in PayTM Mall. It is a nanotechnology-based anti-microbial composite which inhibits and destroys the growth of deadly bacteria, fungus, and moulds. This technology has been tested earlier for various norms and compliance procedures in biotech testing services, Mumbai. It showed the efficiency of 99.99 per cent against the microbes under numerous test procedures. The products that have earlier used this technology have also been tested in independent private laboratories, which has shown the same efficiency rate of more than 99 per cent.
We have also used active silver technology, which is behind these germfree products. Through silver ions, which are evenly distributed throughout the bottle, migrate to the surface and kill the bacteria by puncturing their cell membrane. These silver ions are non-toxic and safe and are certified for use by leading laboratories and institutions. Both these technologies infused in the product help in sanitising it from within and protects it from all the deadly viruses, bacteria, and other microbes till the product’s lifetime. We are aiming this in daily-use retail sector and also in the pharma industry. This new range of products will add to the company’s already existing product portfolio and help the company create a stronger foothold in the glass packaging industry. These airtight products can be used to store dry groceries, snacks, pickles, savouries and more and will help the consumers opt for a healthier lifestyle.
Meanwhile, glass can be a better option for plastic due to its ability to recycle.
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