There is a few issues in your code snippet.

First off: You are using a foreach-loop, but supplying arguments as if it was a for-loop.
You generate invalid HTML, your id attribute need to enclose the value in " or ', eg: id="para".
You'r <p> tag is not closed, but instead followed by another <p> tag (should be a </p>).

You can use either a for-loop or a foreach-loop, but they work differently.
A for-loop would be written much like the one you got:

 for($i=0;$i < count($tags); $i++) { ...

While a foreach would look more like:

foreach($tags as &$tag) { ...

Notice the & sign before $tag, the & indicates that it is a reference to the object, that means, if you change the object inside the foreach loop, it will actually be changed, not just inside the foreach scope.

This means that you can edit the $tag object right away instead of accessing it from the array.
If you rather access it from the array, but still wish to use a foreach you can get both the index (the key) and the value by:

foreach($tags as $key => $value) {
   $tags[$key] = 'html' . $value . 'endhtml';
}

You have to decide which of the loops you intend to use. At the moment it looks like you have mistaken for & foreach loops.

Luckily, this may be done by both ways.

Using for loop

for($i = 0; $i < count($tags); $i++)
{
    $tags[$i] = "<p id='para'>" . $tags[$i] . "</p>";
}

Using foreach loop

As mentioned earlier, but without a real explanation:

foreach($tags as &$tag){
    $tag = "<p id='para'>" . $tag . "</p>";
}

Where the &$tag does a reference, not a copy, therefore it updates the string inside the array. The way you tried to do it, it would only change the copy of it.

And finally, one last thing - If I may recommend, start using apostrophes/quotes when specifying attributes of html tags. It is more clean, more valid and way better looking.

Either Use

for($i=0;$i < count($tags); $i++){

$tag[] = "<p id='para'>" . $tags[$i] . "<p>";

}

Or Use

foreach($tags as $tg){

$tag[] = "<p id='para'>" . $tg . "</p>";

}