South Kraft

Paper & Paper Board The new millennium is going to be the millennium of the knowledge. So demand for paper would go on increasing in times to come. In view of paper industry's strategic role for the society and also for the overall industrial growth it is necessary that the paper industry performs well. Government has completely delicensed the paper industry with effect from17th July, 1997. The entrepreneurs are now required to file an Industrial Entrepreneur Memorandum with the Secretariat for Industrial Assistance for setting up a new paper mill or substantial expansion of the existing mill in permissible locations. The industry is a priority sector for foreign collaboration and foreign equity participation upto 100% receives automatic approval by Reserve Bank of India. Several fiscal incentives have also been provided to the paper industry, particularly to those mills which are based on non-conventional raw material.

Capacity, Production, Raw material and Import
There are, at present, about 515 units engaged in the manufacture of paper and paperboards and newsprint in India. The country is almost self-sufficient in manufacture of most varieties of paper and paperboards. Import, however, is confined only to certain specialty papers. To meet part of its raw material needs the industry has to rely on imported wood pulp and waste paper. Production of paper & paperboard during the year 2002-03(upto December, 2002) is 24.52 lakhs tonnes. At present about 60.8 per cent of the total production is based on non-wood raw material and 39.2 per cent based on wood.

Performance of the industry has been constrained due to high cost of production caused by inadequate availability and high cost of raw materials, power cost and concentration of mills in one particular area. Several policy measures have been initiated in recent years to remove the bottlenecks of availability of raw materials and infrastructure development. To bridge the gap of short supply of raw materials, duty on pulp and waste paper and wood logs/chips have been reduced. The capacity utilization of the industry is low at 60%. About 194 paper mills, particularly small mills, are sick and /or lying closed. Several policy measures have been initiated in recent years.

Imports of paper and paper products was growing over the years. However, it has increased during 2001-02 after a fall in 2000-01. About 1,40,000 tonnes of paper was exported in 2000-01 mainly to the neighbouring countries.

Outlook

India's per capita consumption of paper is around 4.00 kg, which is one of the lowest in the world. With the expected increase in literacy rate and growth of the economy, an increase in the per capita consumption of paper is expected. The demand for upstream market of paper products, like, tissue paper, tea bags, filter paper, light weight online coated paper, medical grade coated paper, etc., is growing up. These developments are expected to give fillip to the industry. Indian paper industry needs the following for being globally more competitive. Sustained availability of good quality of raw materials (forest based) and bulk import of waste paper to supplement the availability of raw materials. Adequate modernization of the manufacturing assests. Improvement of the infrastructure. Quality improvements and reduction in cost of production Import policy conducive for import of material, equipment, instruments, raw materials & technologies which are bearing of the quality and environment.