Posted by Kathryn Schwartz on November 21, 2013
Paper industry


The Government has taken several steps to make availability of raw materials and infrastructure development to overcome the shortage of raw materials. Duty on plup waste paper, wood logs/chips has been reduced.

The Indian Paper Mills’ Association(IPMA), has suggest to setting up of a Rs. 20,000 crore ‘paper fund’. IPMA also, suggested to setting up existing technology upgradation fund (TUF) for improvement of energy conversation, quality upgradation and product improvement.

The Indian paper industry is growing at 8 per cent per annum. It is also, expected to grow by 10 per cent by the year 2010. IPMA also, urged the Government to reduce the excise duty from 12 per cent to 8 per cent for all type of paper mills as they are looking to upgradation of 25 per cent of their capacity.

Indian paper industry has direct linkage with educational sector, manufacturing sector, as a result near about 20 per cent direct and indirect taxation on paper industry including 12% VAT, octroi, etc. Reduction of direct and indirect taxation can make more competitive player in the world.

The following measures can be taken to make Indian Industry more competitive:


(1) For Wood based industry: The Indian paper and newsprint industry already urges the Government to amend the laws for immediate revision of forest policy so that plantation to make use of the degraded land for raising plantations for better quality of plup. But, the Government does not permit forests to be used for sourcing woods by the corporate sector, nor does it allow industrial plantation on degraded forestlands.
(2) For Waste Paper based Industry: Less export duty on Import of waste paper. Introduction of “Ecolabelling” system where in products made from recycled fibre are rated higher than the products made form virgin fibre. Introduction of modern and effective collection and grading system.
(3) For Agro based industry: Funds to be made available for technology modernization and processing of agro residue fibre, particularly for small & medium scale paper industries. Infrastructure Improvements of communication e.g. rail, road, port which will help the entire industrial sector.

Technology Up gradation

There is a wide gap between the technologies of the domestic paper industry in India compared to that of the foreign countries. Most of the paper mills are using old technologies, which is serious cause of resultant in low productivity with high costs of production.

Government Policies

(1) Social forestry scheme should be introduced to small and marginal farmers to promote sapling and know-how for raising plantations of fast growing trees with an assurance of a buy back at a remunerative price.
(2) The industry is also seeking permit duty free imports of new & second hand machinery/equipment for Technology Up gradation.
(3) Right now, an estimated 55-million begasse is available, but currently we are using only 8%.

Begasse can be introduced in replace of using bamboo, rice or white straw.

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