In conversation with Khadem Mahmud Yusuf, Managing Director & CEO, Bangladesh Petrochemical Company Limited (BPCL).
Please provide an overview of the history and establishment of Bangladesh Petrochemical Company Limited.
In 2012, I learnt from a newspaper article that most plastic bottles thrown away in Bangladesh used to end up in China. I was intrigued, so I did some research and found that these bottles were exported to China, where they were recycled to make bottles again or to make polyester fibre or yarn. Europe at the time was quite advanced in plastic recycling, so I went to different European countries, met different suppliers and visited different recycling plants to understand the entire process.
I realised that undertaking such a venture would be commercially viable since we as a country were already using imported Polyethylene terephthalate (PET) resin as well as polyester fibre as raw materials for making water, juice, edible oil bottles as well as polyester fabric. We developed the business plan and raised investment from venture capital, institutional investors, and local financial institutions. We acquired factory land in 2013 and started construction. In 2016, we installed the machines and started commercial operations, and officially inaugurated the factory in October of that year.
What are BPCL’s current projects and could you elaborate on their activities at the moment?
We currently have three products in the market. Our main product is recycled PET (rPET) resin. Our customers use this Food Grade rPET resin for food contact applications, which means to produce water bottles, carbonated soft drink bottles, oil bottles etc. We also have customers who produce Polyester Fiber and Polyester Yarn using our Fiber Grade rPET resin. However, Fiber Grade rPET production is less challenging because it is a non-food grade product and decontamination and sterilisation processes are not required, as there would be in the food-grade products. We also manufacture PET sheets, which is like a polyethene roll, but thicker, and from there we create lunchboxes, biscuit trays, etc.
I think that recycling in Bangladesh is becoming more challenging day by day as we as a nation are using more and more plastic, particularly non-recyclable plastic.
Please walk us through the whole process of collecting the plastic till recycling.
There are a few ways that plastic gets collected. One way is through traditional feriwalas, who buy plastic items from people’s homes. Another way is through vangariwalas, who collect all waste items, but also take any plastic items or bags. There are also tokais who collect plastics from roadsides, open public spaces, etc. Finally, people come and sell plastic products in local collection shops, or vangari dokan, who then separate them according to metal, plastic, paper, etc. We have contracts with bigger vangari dokans, who send the plastic to our factory. However, they have to send at least 5 tonnes of compressed plastic to fill up a truck and make it worthwhile, which is why we can’t directly work with smaller vangari dokans or waste pickers. However, we have set up collection hubs . We currently have about 77 direct suppliers and 3 collection hubs all over the country. Small and medium vangari shops collect plastic and bring them to our collection hubs, from which they are processed and transported to our factory. Waste pickers are paid higher wages as middlemen are cut out from the supply chain.
BPCL’s products are made from 100% post-consumer recycled PET bottles. These bottles then go through a Metal Separator that removes the iron and non-iron metals. After that, an Automatic Polymer Sorting System separates PVC, HDPE and other plastic materials from the PET bottles. The PET bottles are then manually checked for the second time so any remaining metal, PVC, PP or PE parts are removed. The bottles are then crushed into flakes which are taken through Multi-Stage Hot Washing and Drying Systems. The result is flakes that are clean, of very high quality and free of any foreign materials. BPCL’s superior European machinery then transforms the flakes into high-quality resins suitable for food-related and non-food-related usage. The European machineries ensure highly efficient decontamination of the flakes far exceeding minimum purity requirements for direct food contact.
Only 37% of the 646 tonnes of plastic waste collected daily in urban areas of Bangladesh gets recycled. What obstructions are we facing, and how could we overcome these challenges?
I think that recycling in Bangladesh is becoming more challenging day by day as we as a nation are using more and more plastic, particularly non-recyclable plastic. Presently, Bangladesh’s per capita plastic consumption in urban areas is approximately 9 kg, whereas ten years ago it was 3 kg. According to a study, an estimated 300,000 metric tonnes of plastic waste are thrown into the rivers every year. Polythene use has increased 25 times, PET usage by only 4 times, and non-recyclable plastic has doubled since 2005.
In addition, the whole plastic collection process is informal and underground. This is because, if it is done legally, according to the law, tokais and vangari shops need a VAT registration, which dissuades them from registering. People are dissuaded from collecting plastic because they have to pay an Advance Income Tax (AIT) and VAT for each unit they sell. I believe that plastic collection should be incentivised, and there should be no tax on plastic processing.
What are your future plans for the company?
We are very fortunate as we are getting support from many MNCs. We are supplying rPET resin to PepsiCo and Coca-Cola. They are producing water and CSD bottles using our rPET resin. Also, we are working with Unilever to convert some of the High-Density Polyethene bottles such as shampoo bottles into PET bottles using rPET as the raw materials. In addition, we are planning to expand into the fibre segment to produce Polyester Yarn directly from the rPET resin.
To date, we have collected and recycled 25,000 tonnes of plastic bottles, which is roughly 180 crore bottles. There are about 30,000 people in our chain. We have created a stable and ethical supply chain, and we pay a fair market value. In addition, we make sure that suppliers pay their workers well and hire them on a permanent basis instead of a temporary one.
Managing Director & CEO
BPCL
Photograph: Najmul Haque Sagor