Kolkata: Analysts have already told us that the US-Iran war is raising prices of a wide array of items in India. Now reports indicate that even packaged drinking water brands are becoming more expensive. In war-torn March, the biggest drinking water brand in the country Bisleri has raised its price by a significant 11%. Other brands such as Bailley and Clear Premium Water have also revised prices upwards, according to agency reports. The move will hit a lot of people as summer has already set in and in India temperatures can rise to above 40 degree Celsius in many regions and can also touch 45 degrees in some.
Crude oil impact on water prices
Though it might sound remote, there is link between the price of crude oil and water and the rising price of crude oil has forced the manufacturers to raise the cost of water in India. The cost of PET bottles that are used to package water has gone up, prompting a rise in the water prices. PET or Polyethylene Terephthalate is obtained by refining crude oil. Those who manufacture the bottles buy PET preforms and then put them into the different shapes and sizes in which water is packaged.
“The cost of preforms has increased from 115 rupees a kg to around 180 rupees per kg. There is also a shortage in the supply of preforms,” Vijaysinh Dubbal, president of the Maharashtra Bottled Water Manufacturers Association has been quoted in the media as saying. Due to the cost and supply disruptions about one-fifth of bottle manufacturing plants in the state of Maharashtra have temporarily shut operations.
The beverage industry
It is clear from the above logic that not only water, whatever is packaged in PET bottles can become more expensive as the war drags along. Companies are not likely to absorb a rise in input costs for a long time if crude oil supply disruptions are not solved and prices remain elevated, said industry experts.