The domestic plastic sector has been deregulated and di-licensed. Compulsory licensing is required for the following three items only viz. Hydrocyanic acid and its derivatives, Isocyanates and Di-isocyanates and Phosgene and its derivatives, some of which are used in the production of polymers.
100% Foreign Direct Investment (FDI) is allowed through the automatic route without any sectoral cap. Specific approvals are required from Foreign Investment Promotion Board (FIPB) in the following three cases:
● proposals which require the compulsory license,
● when the proposed foreign investment is more than 25% of equity capital of a company manufacturing items reserved for the small-scale sector
● proposals relating to the acquisition of existing shares in an Indian company.
● Plastic raw materials products are imported freely under Open General Licence (OGL).
● The prices of plastics are market determined without any regulatory control.