Banyan Nation pioneers digital eco-system for plastic recycling in India

In the context of the Indian circular economy, packaging – and particularly the plastic packaging industry, is getting its house in order. The brand owners and plastic packaging material producers, including what are known as converters, are grappling with the design of new material structures that can be sorted after consumer use and put into the correct waste stream to yield productive materials, which can be added to new materials for new containers instead of being destined for landfills. 

There are numerous companies that come up in a Google search of Indian packaging or plastic recyclers – some of them are new and novel and others that have considerable experience and a track record that is putting them on the path from a good idea to financial viability. Banyan Nation, based in Hyderabad, is one such company that we first heard speak at one of the Elite conferences in Mumbai a few years ago. At that time, plastic recyclers were still a bit of a novelty and both the rigid and flexible packaging were not sure of the government regulations, which actually became much clearer and began requiring strict compliance in 2021 and 2022.

The latest draft update of the regulations has been issued by the Central Pollution Control Board of the Ministry of Forests and Environment via a gazetted document dated 16 October 2023. This follows the significant revisions of February 2022 that established the guidelines for Extended Producer Responsibility to the original rules issued in 2016.

While the regulations are developing and coming into force, companies such as Banyan Nation, which have tackled the difficult issues of collecting and sorting plastic waste and the technical issues of producing useful recyclates for lateral use in similar packaging, have started attracting their second round of investment. 

Founded in 2013 by two well-educated persons with global business experience, the venture has attracted several rounds of funding since then, adding up to US$ 15 million (approximately Rs 120 to 123 crore at today’s exchange rates). As we spoke to the company’s chief business officer, Rashi Agrawal on the phone in the second half of October, we learned that it has just completed a latest round of funding of US$ 30 million (approximately Rs 245 crore) which brings its overall funding to approximately US$ 45 million.

In the past decade, Banyan Nation has established a modern mechanized plastic recycling facility in Hyderabad with an annual processing capacity of 12,000 tons of post-consumer plastics. The company, which has now achieved about 50 to 60% of its capacity utilization, has become the sole supplier of high-quality blow-grade recycled HDPE resin in India.

Through its fully digitized, traceable, and responsible informal supply chain, Banyan Nation collects discarded HDPE and PP and utilizes its proprietary plastics cleaning technology to remove product and packaging contaminants. Speaking to Agrawal, we learn that this has come about because the company has built up a strong process for waste collection where its 40-member field staff uses digital mapping and tracking tools to essentially collect HDPE and PP waste to engage with the last-mile collectors in the informal sector.

She describes this as, “The Amul model for recycling – similar to where dairy farmers come and deposit their product at designated hubs. We collect the discarded HDPE and PP mostly in the five Southern states at present. Then by utilizing our proprietary plastics cleaning and washing technology, we remove the product and packaging contaminants to produce human-contact-safe recycled plastics that meet US and EU packaging safety standards. In the past years, we have mastered the process of sorting, cleaning, and producing high-quality HDPE recycled resins that can be used as inputs for producing premium packaging.” 

Agrawal emphasizes that the company has established a closed loop with traceability and transparency through its digitized supply chain, starting from its inclusive and responsible engagement with the informal supply chain. She suggests that another key accomplishment of the company is that, “We have created and pioneered the demand for recycled HDPE resins in the country by convincing our brand owner customers, who are mainly large companies, of the authenticity of our closed loop process and the quality of our recycled resins. These are mainly large companies such as Unilever, Reckitt, Shell, and IOCL that are committed to the circularity and integrity of their packaging.” 

When we ask Agrawal about the price of the recycled HDPE resins, she says that although they can cost from 10 to 25% more than virgin feedstock, this expense is alleviated by their liabilities under various national and global regulations. “They can minus the recycled resin cost from their EPR obligations,” she says.

By partnering with leading brands and leveraging its proprietary technology, Banyan has demonstrated that plastic recycling can be simultaneously socially and environmentally responsible and economically viable. The company has won several awards almost every year since 2018. More recently in 2022, Banyan Nation was inducted into the APAC Cleantech 25 list and won the Economic Times Startups Social Enterprise Award. In 2023, it was recognized as a Climate Warrior at the Forbes India Leadership Award.

Apart from recognition and awards, the company is demonstrating a technology-driven and inclusive model for plastic recycling in South Asia and other developing countries. As the company improves its capacity utilization and achieves financial viability in the coming year, one can imagine that the new investment it has attracted will likely take it to a scale that will make it a cornerstone of the circular economy.