New Delhi, Feb. 24 -- India's plastic bottles industry faces a Rs.10,000 crore quandary: investments in a costlier, recyclable, food-grade material risk turning dud as regulatory uncertainty has slowed adoption by beverage makers.

India drafted rules in February 2022 to make it mandatory for beverage-grade bottles to contain at least 30% recycled polyethylene terephthalate (r-PET). It's a kind of material that can be fully recycled. The new Plastic Waste Management Rules were scheduled to roll out from 1 April last year, and the industry was given three years to prepare for the transition.

In anticipation of the enforcement, bottle makers invested in setting up r-PET capacity. However, the environment ministry's draft notification in Ju...