Population, GDP, print and packaging


It’s all very well to say that currently India at 7.3% and Bangladesh at 7.4% enjoy a higher GDP growth rate than China at 6.8% and the rest of the major economies. There are three flaws in this kind of breast beating. The first is that the integrity of the Indian economic and social data gathering and processing have been totally undermined in the past four years, so that the current GDP number given out by the government should perhaps be discounted by 1.5 to 1.8%.

As a guide, IppStar’s (www.ippstar.org) continuous research of the print industry certainly reflects an appreciable tightening of the economy, which would not likely be there if the real GDP growth rate (not the nominal rate which includes the inflationary prices of raw materials and labor) was significantly above 6%. Skeptics may ask, in that case, why is there continued investment in print and packaging equipment manufacturing and in equipment and capacity creation by printers and converters?

The answer is that while there is some significant investment in equipment manufacturing, technology license agreements, and automation, it is mostly on the packaging side for which strong future growth cases can be made in spite of the current squeeze on margins. These cases fall into consumption led growth and not really capex in heavy machinery or infrastructure which are still struggling for investment.

Although one is impressed by several greenfield packaging plants with investments of Rs. 120 crore (US$ 17 million) these are not really large investments and they cannot generate the employment that is needed overall. In any case the human resource available needs training and skills that are not in place. While the print and packaging industries are amongst the healthiest elements of the Indian economy, their relatively smaller entrepreneurs cannot carry the entire economy on their backs.

A corollary to this answer is that while one saw some modernization and automation of Indian equipment manufacturing at the recent Printpack exhibition, one saw a far higher level of distribution and rebadging of Chinese manufactured equipment. The Chinese, totally unlike the Indians, are masters of investment in manufacturing every equipment that has a market at a variety of technology levels and price.

This of course extends to their global success and penetration our industry as shown by Masterworks becoming one of the two largest anchor investors in the iconic Germany based Heidelberger Druckmaschinen. From buying some technology and having a distribution agreement with this icon, it has now become a significant owner. And not least because Heidelberg’s sheetfed offset press factory in China, is one of the best and most efficient printing press factories in the world.

Population, GDP, poverty and education in UP and Bangladesh

To come back to the GDP growth issue, something that has pointed out by leading commentators such as Partho Shome in the Business Standard recently, is that the key measures of growth are GDP to population and the extreme poverty headcount ratios (EPHR). The GDP growth rate in 2017 in India (population 1.339 billion) was 6.7%; Bangladesh (population 165 million) 7.3%; and, the north Indian state Uttar Pradesh (population 219 million) 6.4%.

While India has done better than Bangladesh in controlling population growth, it has clearly been dragged down by states such as Uttar Pradesh which have done worse than the neighbouring country of a similar population. Notably, Bangladesh achieved a GDP per capita of US$ 1522 in 2017, while UP achieved US$ 937 GDP per capita and India achieved US$ 1972 GDP per capita.

A recent education related survey by IppStar shows that the per capita consumption of school textbooks in Bangladesh is roughly 150% that of India. This kind of number reflects several challenges and opportunties – population growth accompanied by extreme poverty in India are not declining sufficiently. Secondly, there is a high disparity among Indian states. Lastly, there is a great opportunity in Indian education – we can begin by catching up to Bangladesh!

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

Subscribe Now


Please enter your comment!
Please enter your name here