India is closely monitoring the ongoing efforts by 76 members of the World Trade Organization (WTO), including major economies like China, the UK, the US, and the EU, as they work towards reaching an agreement on plastics pollution by early next year. These countries have submitted a draft proposal that seeks to regulate and monitor plastics trade while ensuring transparency across the entire life cycle of plastics in internationally traded goods. India, with its relatively low per capita usage of plastics and a ban on single-use plastic, believes that Multilateral Environmental Agreements (MEA) of the UN are the appropriate platform for such discussions. However, as the discussion unfolds, India must carefully consider the potential impacts on its plastic trade and exports, as there are concerns that this move could become a non-tariff barrier, affecting India’s export industry.
Potential Impact on India’s Plastic Trade
The draft proposal submitted by 76 WTO member countries aims to introduce amendments in the Harmonized System to better regulate and monitor plastics trade. While the intention behind this move is to combat plastic pollution and promote a circular economy for plastics, there are concerns that this could lead to potential trade barriers for countries like India. The industry fears that the implementation of new standards and frameworks may make it challenging for Indian exporters to meet the requirements of developed countries, impacting India’s plastics exports, which were valued at $7.7 billion in FY23.
Per Capita Plastic Consumption and Global Share
India’s per capita plastic consumption is relatively low at 15 kg compared to the US, where it exceeds 100 kg, and Italy, where it is 40 kg. This information highlights India’s lower contribution to global plastic consumption and raises questions about the fairness of any potential trade restrictions. India’s share in global plastics exports is slightly above 1%, indicating that it is not a major player in the international plastics market. Despite this, any changes in the regulations could have far-reaching implications for India’s plastic industry.
Challenges for the Plastic Industry
The plastics export industry is concerned about the potential consequences of the proposed changes. Implementing new standards and practices may lead to increased production costs and supply chain constraints. The shift towards non-plastic alternatives and the need to comply with new regulations could pose challenges for manufacturers and exporters in India. Consequently, there is a call for careful consideration to strike a balance between addressing plastic pollution concerns and supporting the growth of India’s plastic industry.
Push for Consensus at the WTO Ministerial Conference
During the recent Plastics Dialogue at the WTO, several countries, including Australia, Barbados, China, Ecuador, and Morocco, advocated for a consensus on a ministerial statement in the upcoming ministerial conference. This highlights the urgency and importance of the issue on the global stage, but it also reinforces the need for India to actively engage and protect its interests during these negotiations.
Conclusion
India’s close observation of the WTO’s efforts to combat plastic pollution is a critical step in safeguarding its plastic trade and exports. While the country acknowledges the importance of addressing environmental concerns through global initiatives, it also advocates for the use of Multilateral Environmental Agreements (MEAs) as the appropriate forum for such discussions. As the negotiations progress, India must strike a delicate balance between supporting sustainability measures and ensuring that any potential changes do not disproportionately affect its export industry. The upcoming ministerial conference at the WTO will be a crucial platform for all member countries, including India, to voice their concerns, propose solutions, and work towards a collective effort to combat plastic pollution on a global scale.
