FSSAI Delay Cripples PET Recyclers

New Delhi, Jun 2 (PTI) Delay in granting licences by food safety regulator FSSAI to recycled PET manufacturing units is likely to push a majority of such plant operators into bankruptcy, the Association of PET Recyclers (Bharat) said on Monday.

The industry has set up an annual capacity of 4 lakh MT at an estimated investment of Rs 7,500-8,000 crore to produce recycled polyethylene terephthalate (r-PET) to be used as food-contact packaging material, a statement said.

Revised FSSAI guidelines, which should have been in place at least 2-3 months before April this year, were notified only in the last week of May 2025, which has further extended the timelines for licence issuance to more than nine applications pending with FSSAI since December 2024/Jan 2025.

Companies have adopted state-of-the-art technology and set up their factories adhering to standards approved by the European Food Safety Authority (EFSA) and the US Food and Drug Administration (FDA).

While a handful of them have received the nod from FSSAI (Food Safety and Standards Authority of India), as many as 15 plants that are fully commissioned are still awaiting clearance from the regulator to commence commercial production, it pointed out.

In 2022, the Ministry of Environment, Forest and Climate Change (MoEFCC) issued guidelines on the usage of 30 per cent recycled food-grade plastic content into PET packaging bottles by beverage manufacturers, which were to come into effect from April 1, 2025.

In 2022-23, FSSAI also came out with guidelines for recycling used PET (polyethylene terephthalate) for food contact applications and five licences were issued. Brand owners have been using r-PET since then.

"Following regulatory guidance by MoEFCC and FSSAI in 2022, and based on the understanding that this would give a huge impetus to the demand for r-PET in packaging bottles by beverage manufacturers, the industry started building capacities and a majority of them have been fully commissioned since January 2025.

The nine applications pending FSSAI approval have resulted in capacities lying idle, it pointed out.

"A majority of these investments have a significant component of debt and any delay in commencing operations could force these companies into bankruptcy,” Shailendra Singh, Director General, APR Bharat, said in the statement.

Close to 50 per cent of the new investment is funded through bank debt.

"If commercial production does not commence soon then these companies may face a huge fund crunch and may find it difficult to service the loan leading to most of these accounts turning into NPA (non-performing asset)," Singh added.

An email query sent to the regulator seeking comments did not elicit a response.

The r-PET industry is estimated to generate 10,000 new jobs and also benefit the rag picker community of over 2 million people engaged in collecting used PET bottles and sending them for recycling.

The Association of PET Recyclers (Bharat) – APR Bharat aims to educate the masses on the importance of recycling, drive innovative solutions for the PET industry, and work in collaboration with businesses, governments, and communities to ensure that recyclable materials are efficiently collected, processed, and reused.