Coca-Cola and PepsiCo Forced to Change Packaging Under New Mandate

India is stepping up its fight against plastic pollution with a new regulation that forces global beverage giants like Coca-Cola and PepsiCo to make significant changes to their packaging. The rule, which took effect on April 1, 2025, requires these companies to use bottles made of at least 30% recycled plastic, with that number set to increase incrementally each year. As the policy rolls out, beverage companies are scrambling to meet the new requirements — but the transition is far from easy.

A Bold Mandate to Tackle Plastic Waste
India’s government has taken a strong stance against the mounting plastic waste that clutters streets and pollutes waterways. The new rule is a key part of a broader effort to establish a circular economy, where plastic bottles are recycled and reused instead of ending up in landfills or oceans.

According to Nature News, the mandate requires beverage companies to meet the 30% recycled plastic threshold in their PET bottles, with the figure climbing by 10% annually. By the end of the decade, beverage packaging will need to be made of 60% recycled plastic, signaling a long-term shift toward more sustainable production practices.

The policy is designed to reduce plastic pollution significantly, an issue that has long plagued India’s urban centers and rural areas. With this directive, the Indian government hopes to curb waste and push the beverage industry toward greener alternatives, which could include biodegradable or plant-based packaging materials. In the short term, however, the shift could lead to higher production costs, which may be passed on to consumers.

The Bottleneck of Recycled PET
While the goals are ambitious, the reality of meeting the new mandates is proving challenging. India currently has only five plants authorized to produce food-grade recycled PET, the material required for packaging beverages. Together, these facilities can only meet about 15% of the total demand for the recycled plastic needed by the industry.

As a result, companies are under pressure to quickly ramp up their recycling capabilities, but expanding production capacity will take several years — a significant problem given the tight deadlines. The limited infrastructure is already causing tension among beverage companies. Some are worried they won’t be able to meet the 30% recycled plastic requirement in time.

“We may have to take legal recourse and take anticipatory stay if the deadline is not extended,” one unnamed executive told The Economic Times. The executive added that the timing of the mandate is particularly difficult as it coincides with the peak summer season, when demand for beverages is at its highest.

Rising Costs and Legal Concerns
The financial burden of complying with the new rule is another hurdle for beverage giants. Using recycled plastic is expected to raise production costs by approximately 30%. For companies already grappling with global supply chain challenges, the increased expense may lead to higher prices for consumers in the short term. With these costs adding up, some beverage companies are concerned about the long-term viability of such a significant shift in manufacturing processes.

The challenge is not just economic but logistical. The capacity to meet the rising demand for recycled PET is limited, and companies are scrambling to secure enough supplies to meet the government’s demands. Some have expressed concerns that if the deadlines are not extended, they will be forced to take legal action to delay compliance.

Despite these struggles, the policy is pushing major beverage companies to think more critically about their environmental impacts and the role of recycled materials in packaging.