Dovetailing with the Union government?s proposal on education for all – Sarva Shiksha Abhyan – the Indian Paper Manufacturers Association (IPMA), the apex body of large integrated paper manufacturers, has requested for a Rs 2,000 crore ?paper fund?. To be set up on the lines of the existing technology upgradation fund (TUF), the proposed fund is expected to help smaller and medium-sized paper mills to work on energy conservation, quality upgradation, and production improvement.
The Rs 22,0000-crore industry, which is expected to see an 8% growth this year, has urged the Union government to rationalise excise duty from 12% to 8% on all varieties of paper and paperboard, as mills are looking at upgrading 25% of their existing capacities.
?Despite the paper industry?s critical importance for the educational sector and significant forward linkages to other manufacturing industries, paper and paper products face direct and indirect taxation of about 20%. This includes the current excise of 12%, VAT, octroi, etc,? IPMA officials pointed out.
There are also different rates of 8% and 16% prevailing for some categories. The rationalisation to a uniform rate of 8% in excise duty is imminent.
IPMA has sought retention of customs duty at 10%, along with the re-introduction of SAD to maintain parity in global production costs. Says Pradeep Dhobale, president, IPMA, the paper industry is operating with farm forestry and agri-residues creating jobs in the farm sector.
A serious issues faced by the industry is unavailability of quality raw material at a competitive cost. The association has requested the government to consider the adoption of the multi-stakeholder partnership model, as proposed by the ministry of environment and forests (MoEF) for forestation of degraded land. ?At least 2% degraded forestland must be accessible to the paper mills to produce pulpable wood to achieve cost competitiveness in terms of wood and freight, Dhobale said.
