The Diet Coke Shortage in India: An Analysis of Upstream Strength and Downstream Weakness in the Aluminium Value Chain

Abstract

Recent shortages in Diet Coke beverage cans in India due to trade constraints because of the West-Asia crisis prompt an investigation into the larger issue regarding India’s reliance on imports of Aluminium specialty products (sheets and beverage-grade cans) despite being the world’s 2nd Largest Aluminium Producer. This apparent contradiction forms the foundation for this research.

This study analyses the five main constituent stages that lead to the final product of beverage-grade cans, including bauxite mining to primary aluminium smelting to can-sheet rolling, quantifying the value added in each stage and attempting to identify the bottleneck in India’s Aluminium Production capabilities.

The findings indicate that India's strengths lie in upstream activities such as mining, refining, and primary aluminium production, while comparatively limited domestic capacity in specialised beverage can-sheet rolling, which has created a reliance on imports. The research concludes that this dependence is not the result of insufficient aluminium resources but is affected by a multiplicity of factors such as historically low demand and preference for plastic/PET beverage bottles, economics of scale and preference of producing other Aluminium Products.