The packaging industry in India has emerged as a key driver of innovation and value creation across manufacturing sectors, particularly in FMCG, agriculture, and food processing. As of September 2024, India became the third-largest packaging market globally, surpassing Japan, with the industry exceeding Rs. 7,36,246 crore (US$ 86 billion). Packaging now ranks as the fifth-largest sector of the Indian economy, expanding rapidly at 22-25% annually. This growth is fuelled by rising middle-class consumption, the boom in e-commerce, improvements in supply chains, and an increasing emphasis on food safety and quality. India’s food processing sector is adopting smart and innovative packaging, boosting food safety and positioning the country as a global hub for packaging materials.
Paper and paperboard form the backbone of India’s packaging ecosystem. In 2024-25, the domestic paper market was estimated at 23.84 million tonnes, growing at nearly 6% annually. Packaging paper and paperboard accounted for 15.54 million tonnes, led by kraft paper and high-grade board. Tissue registered the fastest growth, while newsprint continued to decline. India currently has around 850 paper mills producing 25 million tonnes annually, with production expected to reach 35 million tonnes by FY30. Installed capacity utilization is high at 95%, with domestic sales dominating consumption and exports crossing 0.49 million tonnes in 2024-25. However, to meet quality-specific requirements, India continues to import specialty paper and high-grade board, with imports rising to 2,778.40 thousand tonnes in 2024-25.
A notable feature of India’s paper industry is its reliance on sustainable raw materials. Around 74-76% of production in 2024-25 came from recovered paper and recycled fibre, 18-20% from wood and bamboo, and 6-8% from agro residues like bagasse and wheat straw. This shift aligns with the country’s growing green packaging market, projected to expand at a CAGR of 7.24% during 2023-28.
Technology adoption is also shaping the sector. Smart packaging solutions, including RFID, NFC, and QR codes, are increasingly being used to enhance product authentication and supply chain efficiency. Flexible packaging, driven by strong demand from the FMCG sector, is expected to expand by Rs. 1,35,642 crore (US$ 15.6 billion) during 2024-28, growing at a CAGR of 12.7%.
India’s packaging sector is also highly entrepreneurial, with over 22,000 packaging units, of which 85% are small and medium enterprises. The government’s supportive policies, including 100% FDI under the automatic route, are further boosting growth. Cumulative FDI inflows stood at Rs. 10,367.64 crore (US$ 1,768.05 million) in the Paper and Pulp (including paper) sector between April 2000-December2025. In the Union Budget 2026-27, the government has allocated Rs. 12.2 lakh crore (US$ 139.75 billion) towards capital expenditure, reinforcing infrastructure-led growth and supporting demand for packaging materials across FMCG, pharmaceuticals, and e-commerce sectors.
According to a Brickwork Ratings report, India produces around 5% of global paper and ranks 15th worldwide, with demand expected to reach nearly 30 million tonnes by 2027, driven by packaging, e-commerce, FMCG, and education. Despite relatively low per capita consumption of 16 kg compared to the global average of 57 kg, the sector offers strong growth potential supported by rising literacy, expanding retail, and increasing preference for sustainable paper-based packaging.
In January 2026, the Union Cabinet approved a Rs. 1,788 crore (US$ 204.8 million) project to establish a new banknote paper production line in Narmadapuram to strengthen domestic manufacturing of high-security paper.
In December 2025, SIG commenced full operations at its first aseptic carton manufacturing plant in Ahmedabad, Gujarat, strengthening its presence in India’s dairy and beverage packaging market and supporting regional exports.
PAPEXPO 2025, India’s first dedicated paper industry exhibition, was held from June 6–8, 2025, at HITEX Hyderabad, bringing together over 100 exhibitors and 15,000+ visitors across the paper, packaging, printing, and recycling value chain.
February 2025 - Tetra Pak: Introduced packaging with 5% ISCC PLUS certified recycled polymers, aligning with April 2025 plastic-waste compliance rules.
January 2025 - Huhtamaki India: Hosted 2nd Think Circle forum with CII to accelerate design-for-recycling standards for flexible packaging.
January 2025 - Canpac Trends: Acquired Saptagiri Packagings, adding blister-backer cards and a Silvassa plant to strengthen western-India operations.
December 2024 - JK Paper: Merged Horizon Packs, Securipax Packaging, and JKPL Utility Packaging; acquired Radhesham Wellpack to expand corrugated packaging capacity.
In May 2024, Andhra Paper Ltd. signed a Rs. 125 crore (US$ 14.4 million) deal with Sweden’s Valmet AB for a tissue paper production line, following its Rs. 270 crore (US$ 31.1 million) investment approval for a 100-ton daily capacity machine at its Andhra Pradesh facility.
Oji India Packaging Pvt Ltd inaugurated its fifth facility in the country at Sri City in Andhra Pradesh. The factory will produce corrugated boxes and packaging accessories and employ approximately 300 people in the region.
The Food and Grocery market contributes almost 70% of the total retail sales. Departmental retail stores in the urban food market and unit packaging n in the rural food markets are key drivers of flexible packaging in the country.
In January 2024, Rigid plastic packaging solutions provider Mold-Tek Packaging Ltd (MTPL) opened three manufacturing facilities in Cheyyar (Tamil Nadu), Sultanpur (Telangana), and Panipat (Haryana). The facilities will increase the business’ capacity to 5,500 tons annually, bringing the overall capacity to 54,000 tons annually by FY25. The company invested about Rs. 100 crore (US$ 11.5 million) in these units.
India’s paper and packaging industry is poised for strong growth, supported by rising urbanisation, e-commerce expansion, and increasing demand from food processing and FMCG sectors. Sustainability is becoming a key driver, with recycled fibre already accounting for nearly three-fourths of paper production and the green packaging market projected to grow at 7.24% CAGR through 2023-2028. Government support through Make in India, MSME-focused budgetary measures, and 100% FDI are spurring investment, while innovations such as smart packaging with RFID and QR codes are enhancing efficiency and consumer engagement. Despite challenges like raw material volatility and import dependence for specialty paper, India’s emergence as the world’s third-largest packaging market underlines its potential as a global growth hub.
