Domestic paper industry has welcomed finance minister P Chidambaram?s initiatives to provide fillip to paper manufactured from non-conventional sources. The move would help reduce burden on bamboo and wood that significantly contribute to paper-making.
Out of the 75 lakh tonne of paper production and consumption within the country, about 50% is produced through non-conventional sources that includes rice hash, recycled paper and cutting from other products. The industry had earlier demanded the government let it undertake plantation on specified land to meet its raw material demand. The Centre, however, did not consider the request in the policy document.
The booming economy, which is growing at a healthy rate of 8%, calls for a robust paper industry, which is poised to grow from 7.5 million tonne in 2006-07 to about 14 million tonne by 2015-16.
?If the country has to improve its literacy rate, paper has to grow,? said chief finance officer J K Paper Ltd V Kumaraswamy.
The finance minister was appreciated for reducing excise duty on writing paper, printing paper and packing paper from 12% to 8%.
Kumaraswamy said that sops for 3,500 metric tonne would not be of much help to the industry, which is looking at setting up one-and-a-half lakh tonne of plant.
India still consumes about 7 kg of paper per person per year whereas developed countries consume about 350 kgs per year.
?The move towards rationalisation of excise duties on paper will go a long way in bringing about a level-playing field and increase the global competitiveness of the Indian paper industry. Bringing down duties will encourage investments in capacity addition, incorporation of cleaner technologies and support the government?s thrust on education sector as announced in the Budget 2008,? secretary general, Indian Paper Manufacturers Association, Narayan Moorthy said.