The import of paper and paperboard into India rose by 39% at 409,000 tonnes in Q1FY24 over 294,000 tonnes in Q1FY23, according to the latest data issued by the Directorate General of Commercial Intelligence and Statistics (DGCI&S), the Indian Paper Manufacturers Association (IPMA) said, expressing concern that such unregulated imports could hit domestic paper makers.
The surge in imports comes in the backdrop of a 25% increase in paper and paperboard imports in the entire financial year 2023 over FY22.
In value terms too, the imports accelerated by nearly 28% during the quarter to stand at Rs 3,153 crore. In FY23, Rs 12,531 crore worth of paper and paperboard was imported, IMPA said.
The import of all grades of paper is accelerating, the data said. The highest jump of 214% was seen in the import of uncoated writing and printing paper. There was a 28% rise in the import of coated paper and paperboard, 15% in kraft paper, and 65% in tissue paper.
In Q1FY24, imports from Asean countries increased by a staggering 198%, and from China by 37% in volume terms.
The top sources of uncoated writing and printing paper are Indonesia, Singapore, and China. The top import sources of coated paper and paperboard are China, Japan, and South Korea.
According to Pawan Agarwal, president of the Indian Paper Manufacturers Association (IPMA), domestic paper manufacturers have made large investments and there is adequate domestic production capacity in the country for almost all grades of paper. “Such large investments in the country should not be allowed to be jeopardized by allowing imports at nil of preferential customs duties.”
“Substantial quantities of paper and paperboard are being imported into the country at significantly lower costs with nil import duty from Asean nations, South Korea and Japan under the respective free trade agreements (FTAs), and preferential import duty from China under the Asia Pacific Trade Agreement (APTA). Taking advantage of the nil or low import duty rates in India, these countries find India as an attractive outlet for diverting their excess inventory while the domestic industry is grappling with the issue of producing paper and paperboard at competitive costs,” Agarwal said.
Duty-free imports are making most small and medium paper mills in India commercially unviable, and hurting the livelihoods of thousands of farmers who are engaged in agro and farm forestry and who supply wood, the primary raw material, to paper mills. This is against the spirit of Make in India and Aatmanirbhar Bharat, Agarwal said.
The IPMA urged the government to increase the basic customs duty on the import of paper and paperboard to provide a level playing field to domestic paper makers. It also urged the government to issue quality control orders on all grades of paper and make BIS certification mandatory. Quality control orders for different grades of paper will not only assure the supply of quality products to Indian consumers but also check the import of sub-standard products into the country, the association said.
Rohit Pandit, secretary general, IPMA, said suitable safeguards, anti-dumping and countervailing duties on the import of various grades of paper should be expeditiously imposed, especially once recommended by the directorate general of trade remedies, apart from urgently reviewing the FTAs signed earlier, especially with Asean nations, Korea and Japan, which have harmed the domestic industry.
