[100]

Chapter-III

GROWTH AND DEVELOPMENT OF PAPER

INDUSTRY IN INDIA

“If man may now be considered as having reached a high state of civilization, his gradual development is more directly due to the

inventions of paper and printing than to all other factors.”

— Dard Hunter

The previous chapter highlighted the concept of performance appraisal. It has

specifically dealt with the types, importance and limitations of financial statements

analysis. It also pointed out the relevance of performance appraisal for other

industries in general and paper industry in particular. In the following chapter, an

attempt has been made to analyze the trends in the growth and development of paper

industry in India.

INTRODUCTION

The word paper is derived from the Latin word from the name of the reedy

plant ‘papyrus’ and French ‘papier’ (Kulshrestra: 1988). It is a web composed of

vegetables fibres, roughly oriented and matted together to form sheets. Paper is made

of raw material of the manufacture of paper is cellulose fibre, which is obtained from

trees, recovered paper and annual vegetable fibres like cereal straws, kaolin, starch

and other products are used as auxiliary materials in the paper production process.

Paper can be defined as a sheet or continuous web of material formed by the

deposition of vegetable, mineral, animal or synthetic fibres or mixtures with or

without the addition of other substances into liquid vapors, or gas in such a way that

the fibres are intermeshed together (Kulshrestra: 1988). Paper is a material made of

cellulose pulp, derived mainly from wood, rags and certain grasses, processed into

flexible sheets or rolls by deposit from an aqueous suspension and used chiefly for

writing, printing and drawing, wrapping and covering walls

[101]

(http://www.thefreedictionary.com/). It is a thin material used for writing upon,

printing upon or packaging, produced by the amalgamation of fibers, typically

vegetable fibers composed of cellulose, which are subsequently held together by

hydrogen bonding. While the fibers used are usually natural in origin, a wide variety

of synthetic fibres, such as polypropylene and polyethylene, may be incorporated into

paper as a way of imparting desirable physical properties. The most common source

of these kinds of fibres is wood pulp from pulpwood trees vegetable fibre materials

such as cotton, hemp, linen, and rice are also used (http://stationery.

indiabizclub.com/).

Paper is more than an industrial product. It is the cultural barometer of the

nation. We need paper every day for widening the frontier of our knowledge. The new

millennium is going to be the millennium of the knowledge. Paper is one of the

significant discoveries that turned the history of the world around. Pulp and paper

constitute one of the most important segments of India’s industrial economy and is

treated as a basic sector. Paper pervades all sectors of our activity from book to bullets

and from morning newspaper to nuclear technology. From the time immemorial,

paper has played a key role in the evolution of our civilization. The importance of

paper and paper product in the modern life is so obvious that no other manufactured

product processes such diversity of use. It is a basic medium of communication and

dissemination of information. It helps all the human beings for the growth of

education, reading, writing, storing, knowledge, quality of life, culture, and other

sectors of the economy. Kids to kings, all human being, are using paper either directly

or indirectly. It is very difficult to imagine modern life without paper

(Reddy.et.al:2003).

HISTORY OF PAPER

Paper has a long history, beginning with the ancient Egyptian and continuing

to the present day. For thousand of year, hand-made methods dominated and then,

during the 19th

century, paper production became industrialized.

3000 BC

[102]

Of all the writing and drawing materials that people have employed down the

ages, paper is the most widely used around the world. Its name derived from papyrus

the material used by the ancient Egyptian, Greeks and Romans. Papyrus, however, is

only one of the predecessors of paper that together are known by the generic term

‘tapa’ and are mostly made from the inner bark of paper mulberry, fig and Daphne.

Recent archaeological excavations in china have revealed some of the oldest ‘tapa’

paper ever found which shows that paper was being produced in china before western

records began.

AD 105

In AD 105, the Chinese court official, Ts’ai Lun, (if we are to believe the

chronicle recording the claim) invented papermaking from textile waste using rags.

This can be considered as the birth of paper.

AD 610

Chinese papermaking techniques reached Korea at an early date and were

introduced to Japan in the year 610. In these two countries, paper is still made by hand

on a large scale in the old tradition, preferably from the fresh bast fibres of the

mulberry tree (kozo in Japanese).

Very soon, knowledge of papermaking spread to Central Asia and Tibet and

then on to India. When the Arabs, in the course of their eastern expansion, neared

Samarkand they too became acquainted with the production of paper and paper mills

were subsequently set up in Baghdad, Damascus and Cairo, and later in morocco,

Spain and Sicily.

14th

Century

In the course of the rapid expansion of trade in the late middle ages, more and

more merchants dealt in the commodity called ‘paper’ that was growing in importance

for public and intellectual life. The Nuremberg councilor Ulmann Stromer (Stromeir)

mulled over the advantages of making his own paper and, with the help of skilled

workers from Italy, transformed the ‘Gleismuhle’ by the gates of his home town into a

paper mill. The dates noted in his diary, 24 June 1390 (start of work on the

waterwheel) and 7 and 11 august 1390 (oaths sworn by his Nuremberg foremen), are

the first assured records of papermaking on German soil.

[103]

16th

Century

The advantages of this mill-based papermaking technique, which spread

throughout Europe in the 15th

and 16th

centuries: far outweighed the disadvantages of

considerable outlays of time and capital for building and fitting out with new

machinery and equipment.

17th

Century

Technical progress continued in the 17th

century. Smoothing the sheet by

hand, using a creasing knife or ‘blood stone’ was supplemented by the use of a

smoothing hammer (similar to a forging hammer). Towards the end of the 17th

century, a new and much more efficient beater, called a ‘Hollander’, was invented.

This supplemented, or even replaced the stamping mill and further divided

papermakers into two new camps.

18th

Century

During the 18th

century there had been some concentration of craft activities in

large operations, the ‘manufactories’, which were dependent on skilled papermakers

organized into craft groups. The initial model was the vat that was used by J.N.L.

Robert, who built the first flat-screen papermaking machine in 1798. This was further

developed in England, mostly by Donking and the Fourdrinier brothers.

19th

and 20th

Century

The history of the paper industry in the 19th

and 20th

centuries can be broken

down into following five partly overlapping periods, each marked by definite trends:

In the first stage (from about 1800 to 1860), all work sequences previously

performed by hand were mechanized.

During the second stage (about 1840 to 1880), efforts were made to obtain rag

substitutes on an industrial scale (ground wood pulp and chemical pulp) and

appropriate industrial plants (ground wood and chemical pulp mills) were developed.

The third stage (1860 to 1950) was marked by the enlargement of the web

width, an increase in working speeds, the introduction of electric drive and further

improvements to various machine parts.

[104]

The fourth stage (1950 to 1980), which was still dependent on the old methods

as far as the mechanics were concerned, brought unprecedented changes in

papermaking.

The fifth stage leads into the future. The evolution of new sheet-forming

principles (with fluid boundaries between paper and non-woven fabrics) and chemical

pulp processes have been the main process improvements.

During the 20th Century machines were designed specifically for the

production of particular paper and boards. New materials and chemicals were

introduced into the process and automation occurred. New sheet forming principles

and chemical pulp processes also evolved (http://www.paperlinx.com/).

21st Century & Beyond

Paper is an amazing product: it is renewable, clean and incredibly versatile. It

continuously offers new possibilities, applications and end-uses.

Paper can be impregnated, enameled, creped, waterproofed, waxed, glazed,

sensitized, bent, folded, twisted, crumpled, cut, torn, dissolved, molded and

embossed. Who knows to what uses it will be put in the future?

(http://www.paperonline.org/).

GLOBAL PAPER INDUSTRY

The global paper and paperboard industry is dominated by North America,

Europe and Asia. Global paper and paperboard production stood at around 380

million tons in 2008, the US leading with over 100 million tons and accounting for

nearly a third of the world’s production. It is expected to increase to 392 million

tonnes by 2010 and 490.0 million tonnes by 2020.With a large number of paper

production capacities shutting down in North America and growing capacity creation

in Asia (especially China), the latter accounts for over a third of global paper

production, while Europe and North America account for about 30 per cent and 25 per

cent respectively. Interestingly, even as per capita paper consumption in the US is 300

kg, it is 35 kg in Asia, implying excellent growth prospects. The global pulp and

[105]

paper industry consists of about 5000 industrial pulp and paper mills, and an equal

number of very small companies.

The global paper consumption in F.Y. 2000 was approximately 325 mn

tonnes. Writing and Printing segment accounted for 32 per cent of the global paper

consumption while Packaging, Tissue and Sanitary and Newsprint accounted for 50

per cent, 6 per cent and 12 per cent respectively.

The US is the largest market for paper product and commands high per capita

consumption. Asia’s main markets are China, Japan, India, Malaysia, Singapore and

Thailand. In 2005, Japan had the highest per capita consumption (247 kg), followed

by Singapore (228 kg), Malaysia (106 kg), Taiwan (51 kg) China (42 kg), Indonesia

(22 kg) and Philippines (16 kg). India’s per capita consumption is estimated to be as

low as 7.0 kg in 2006.

Chart 3.1 Showing the Paper and Paperboard Production in Global Market

[106]

Chart 3.2 Showing the Consumption per Capital of 2005 and 2006

Source: CEPI; RISI; European recover paper council; ICEM World Paper Conference

(November 2005); Research India Analysis

Paper demand is unevenly distributed as 72 per cent of the world’s paper is

consumed by 22 per cent of the world’s population – in the US, Europe and Japan.

The world demand for the material is expected to grow by around 3 per cent annually,

reaching an estimated 490 million tons by 2020, with significant growth coming out

of Asia and Eastern Europe. Asia dominates the demand for paper and paperboard;

consumption increased at a CAGR of 7 per cent across 2003-08. China is now the

world’s second-largest household paper consuming nation (http://industrytracker.

wordpress.com/).

The global paper demand has turned very sluggish. The excess supplies

globally are being dumped into various countries, including India. This dumping of

paper is affecting the Indian paper sector, which is in the midst of massive capacity

additions. The annual global paper and paperboard production was approximately

382.0 million tonnes in 2006. It is expected to increase to 392.0 million tonnes by

2010 and 490.0 million tonnes by 2020.

[107]

PRESENT STATUS OF PAPER INDUSTRY IN INDIA

The paper industry in India is one of the most thriving industries in the

country. The Indian paper industry accounts for about 1.6 per cent of the world’s

production of paper and paperboard. Indian paper industry is the 15th

largest in the

world and provides employment to 1.3mn people in country contributing Rs25bn to

the government.

The first paper mill was set up in India more than 100 years ago. In India, the

first paper industry was developed in Kashmir, established by Sultan Zainul Abidin

(Shahi Khan) of Kashmir in 1417-67AD. (http://www.infinityfoundation.com). Paper

was observed in common use almost all over India at the close of Akbar’s reign. The

improved qualities of handmade paper were produced in the latter half of the

eighteenth century. William Carey started a paper mill in 1812 at Serampore, West

Bengal. Indian government had given preferential treatment to the indigenous paper

production in 1880 to encourage and establishment of paper mills. Over the years,

paper industry had been transformed into one of the major and key industries of the

country.

The growth in paper is inevitable and is likely to contribute significantly to the

government’s target of achieving an overall growth of 12 per cent in manufacturing.

Unfortunately, the rising costs of raw materials, primarily wood and wood products,

are a big challenge facing the industry (http://www.indiaenews.com/). The industry

has recorded a volume growth of CAGR of 5.47 per cent over the last 3 years. In

2003-2004, it recorded a volume growth of 6 per cent in line with the GDP growth.

The Indian paper industry is accorded ‘core sector’ status since paper is

categorized as an essential commodity by the government. The progress of paper

industry is inextricably linked to the national priorities and with the changing times,

its fortunes fluctuate. Indian paper industry has a 1:1 correlation with the economy.

With the expected GDP growth of 6.9 per cent for F.Y 2005 and 7-8 per cent for F.Y

2006 as per RBI, the paper sector is expected to record a similar growth rate.

Indian economy has experienced healthy GDP growth during recent years and

the perspectives are positive for the future also. The paper industry has a crucial role

to play for economic growth of the country as paper consumption is considered as one

[108]

of most important indices of educational and cultural growth of a nation. The industry

growth, pegged now at 7-8 annually (http://www.capitalmarket.com). The paper

industry can broadly be classified into following:

Paper and paperboard (writing, printing, packaging and tissue). The writing

and printing paper market can be further divided into coated and uncoated segments.

Newsprint mainly uses for newspapers, flyers, and other printed material

intended for mass distribution.

Fig 3.1

The Rs. 25,000-crore Indian paper industry accounts for about 1.6 per cent of

the world’s paper and paperboard production even though the country accounts for

nearly 16 per cent of the global population. The Indian paper industry’s market size

has been estimated at Rs.321 billion, growing at a CAGR of 10.5 per cent from

around Rs. 195 billion in 2003-04 to Rs. 321 billion in 2008-09. In 2009-10, the

country produced 9.18 million tons of paper, growing at an average 6-7 per cent

compared with 2 per cent growth in developed countries. The paper industry growth is

forecast at 8.4 per cent annually, touching 11.5 million tons in 2011-12 and 15 million

tons by 2015. In India, paperboard accounts for nearly 47.3 per cent of the total

market size, followed by writing and printing paper (29.6 per cent), newsprint (19.5

per cent) and specialty paper (3.6 per cent) according to CRISIL Research

(http://industrytracker.wordpress.com/).

The growth of machine made paper industry can be divided into two phases

such as: Pre Planning Period and Post Planning Period.

Paper and Paperboard Newsprint

Packaging Tissue and Sanitary Printing and Writing

[109]

PRE PLANNING PERIOD

India’s production of paper at the beginning of the twentieth country was

estimated at 19,000 tonnes. In 1911, the production was at 27,200 tonnes. Their

production levels reached to 40,000 tonnes in 1931 and to 1,10,100 tonnes by 1945.

The Second World War (1939-1945) provided adequate impetus for the stabilization

and expansion of paper industry in India. All types of paper and paperboard were

made during this period. The post-war economic boom coupled with cessation of

imports, made indigenous production rise considerably and the industry attracted

sizeable investment. But the production of paper generally remained stagnant until

1950 as is evident from Table- 3.1

Table (3.1) : Production of Paper in India (1911-1950)

Year Production

(‘000 tonnes)

Growth Rate (per cent)

Over previous year

1911 27.20 0

1921 24.70 -0.091

1931 40.00 0.619

1941 95.00 1.375

1945 110.10 0.022

1950 109.3 0.030

Source: Paper Industries in India: Report and directory, 1980

POST PLANNING PERIOD

The planned development in paper industry in India began only in post

independence period. The growth however slowed down in sixties owing to the

escalation of cost and scarcity of forest based raw material.

The Indian paper industry made significant strides in post independent period.

Organized growth of paper industry commenced only in the planning era from 1951

[110]

onwards. With the setting of new mills and modernization of and expansion of

existing mills, under the various Five Year plans, the paper industry has showed an

impressive development. The targets and achievements, under various Five Year

Plan/Annual plans, are given in the Table-3.2 (Reddy: 2003). The following table

shows the Plan Wise Capacity and Production of Paper Industry in India:

Table (3.2) : Capacity and Production of Paper Industry in India

(First Plan to Eleventh Plan)

Note: *: Anticipated

Source: Centre for Industrial & Economic Research (CIER).

(mn MT)

Plan Periods Year Capacity Production

Target Actual Achievement

Quotient

(per cent)

Target Actual Achievement

Quotient

(per cent)

First Plan 1951-56 0.21 0.21 100 0.2 0.19 93.6

Second Plan 1956-61 0.46 0.43 94.1 0.36 0.35 98.3

Third Plan 1961-66 0.83 0.67 80.3 0.71 0.56 78.5

Annual Plan 1966-69 0.75 0.73 97.3 0.64 0.66 103.6

Fourth Plan 1969-74 - 0.99 - 0.85 0.83 97.1

Fifth Plan 1974-79 1.3 1.14 87.5 1.05 0.9 85.7

Sixth Plan 1980-85 2.05 2.4 117.1 1.5 1.36 90.7

Seventh Plan 1985-90 2.7 3.04* 112.6* 1.8 2.43* 135

Eighth Plan 1992-97 3.85 4.2 109.1 3.2 2.8 87.5

Ninth Plan 1997-02 4.9 5.1 104.1 4.2 3.7 88.1

Tenth Plan 2002-07

2002-03 5.1 3.4

2003-04 5.1 5.6

2004-05 7.4 5.9

2005-06 7.6 5.9

2006-07 7.8 6.1

Eleventh Plan 2007-12 7.5

2007-08 7.8 6.3*

[111]

TRENDS IN PRODUCTION OF PAPER IN INDIA

The growth of the Indian paper industry for last decade is indicated in graph

3.3 the data indicates that in the beginning of the millennium the production growth

rate shows a downward trend. This is however more a case of capacity constraints

from 2004-06, where after the industry announced many capacity expansions and up

gradations. Due to recession there is a sharp fall in the year 2007-2008. This bottle

neck is likely to ease out in the coming time as about 58 projects worth Rs. 20,907

crores are outstanding in the sector. Even in the face of recession, as many as 29

projects with an outlay of Rs. 6,724 crore are under implementation (Mathur: 2009).

Graph 3.3

Production Growth Rate of the Paper and Paper Board Sector

Year-wise Capacity and Production of Paper Industry in India (1980 to 2008-09)

The capacity and production of paper has tremendously increased over a

period of time in India. Data set out in the following table 3.3 shows the Year Wise

Capacity and Production of Paper Industry in India from 1980 to 2008-2009:

[112]

Table (3.3) : Capacity and Production of Paper Industry in India (1980, 1985

to 2008-2009)

(Lakh or 0.1 mn MT)

Year Installed

capacity

Production Capacity Utilization

per cent

1980 15.4 10.6 68.8

1985 23.5 14.3 60.6

1986 26.5 15.5 58.6

1987 27.6 16.5 59.8

1988 28.5 17.2 60.9

1989 30.1 18.2 60.3

1990 30.4 19.6 64.5

1991 32.8 19.6 59.8

1992 34.2 21.3 62.3

1993 35.5 22 62

1994 37.9 22.2 58.6

1995 36.7 35.4 96.5

1996-97 41 39.1 95.4

1997-98 43 43 100

1998-99 44.5 44.5 100

1999-00 51 51 100

2000-01 51 48.4 94.9

2001-02 51 49.5 97.1

2002-03 55 52.4 95.3

2003-04 51 55.6 109

2004-05 72 57.9 80.4

2005-06 76.0 59 77.6

2006-07 78.0 62.5 80.1

2007-08 78.0 62.9 80.6

2008-09 (Prov.) 89.0 53.9 60.6

Source: Centre for Industrial & Economic Research (CIER). (652)

[113]

Chart 3.4 Showing the Production of Paper and Paperboard in India from 2000

to 2009

Trends in Per Capita Consumption of Paper in India

India’s per capita consumption of paper and paper products is around 8 kg as

against the world average of 56 kg. The Indian per capita consumption of paper is 7

kg, in comparison to the Asian average of 21 kg, World average of 55 kg and US

average of 331.7 kg. So the Indian pulp and paper industry has got a tremendous

growth potential estimated at about 8 per cent per year. India’s per capita paper

consumption grew 10.6 per cent in 2009-10 (from 8.3 kg in 2008-09 to 9.18 kg)

compared with 45 kg in China and 350 kg in developed countries, implying a large

scope for correction. Of the total consumption, Printing and Writing paper accounts

for about 35%, Newsprint 20% and Industrial and Speciality Papers 45%. In the

following chart 3.5 capacity variety wise paper is shown:

[114]

Chart 3.5

As paper consumption is linked to economic development, India has emerged

as one of the world’s fastest growing paper markets. Per capita consumption increased

from 8.3 kg during 2008-09 to 9.18 kg in 2009-10, a growth of 10.6 per cent even

though this is low compared with Japan’s 250 kg, Korea’s 170 kg, China’s 45 kg,

world average per capita consumption of 56 kg and Asian average of 46 kg. The

following table shows the Per Capita Consumption of Paper in India from 2000-2001

to 2010-2011:

Table 3.4 : Per Capita Consumption of Paper in India

Year Consumption (in Kgs)

2000-2001 4.44

2001-2002 4.44

2002-2003 4.38

2003-2004 4.8

2004-2005 4.6

2005-2006 6.0

2006-2007 7.0

2007-2008 8.3

2008-2009 9.18

2009-2010 Exp. 9.4

2010-2011 Exp. 10.0

Source : Compiled from Various Reports

[115]

Chart 3.6 Showing the Per Capita Consumption of Paper in India

Chart 3.7 Showing the per capita consumption of various countries

h

ttp://www.pcra.org/english/latest/book/11-chapter-11.pdf

[116]

Chart 3.8 Showing the Expected Production and Consumption of Paper and

Paperboard in India in the year 2009-2010, 2014-2015 and 2019-2020

Source: CII; IPMA; Bilt; Research India analysis

India is self-sufficient in manufacture of most varieties of paper and

paperboards. Import is mainly related to certain specialty papers such as light weight

coated variety of paper, cheque paper, etc. Due to the scarcity of raw material, the

companies also need to rely on imported wood pulp and waste paper. It is well known

fact that the volumes of import and exports of paper in India are small. The Graph 3.9

indicates that imports of paper and paper boards in to India are increasing steadily in

the past few years. The rate of exports growth on the other hand has shown a steady

downturn. The industry needs to monitor this situation closely so that the balanced of

trade is maintained in the interest of the industry.

[117]

Graph 3.9

Balance of Trade for the Paper and Paper Board Sector

Indian pulp and paper industry is experiencing the positive impact of a robust

GDP growth. Paper consumption is set to double from the current 7 million tonnes per

annum in the next eight years, according to Indian Paper Manufacturers Association

(IPMA). Increasing demand for paper brings with it new challenges of economies of

scale, efficient usage of resources, need to develop and expand sustainable use of

fibre, and vale chain management. During the period 2002-2007 newsprint registered

a growth of 13 per cent, writing & printing, containerboard, carton board and other

registered growth of 5 per cent, 11 per cent, 9 per cent, 1 per cent respectively. At the

national level, India generates the highest return on capital employed in the global

paper and forest products industry. India is the fastest growing market for paper

globally and it presents an exciting scenario; paper consumption is poised for a big

[118]

leap forward in sync with the economic growth and is estimated to touch 13.95

million tons by 2015-2016 (http://www.capitalmarket.com).

The futuristic view is that growth in paper consumption would be in multiples

of GDP and hence an increase in consumption by 1 kg per capita would lead to an

increase in demand of I million tonnes. As per industry estimates, paper production

are likely to grow at a CAGR of 8.4 per cent while paper consumption will grow at a

CAGR of 9 per cent till 2012-13. The import of pulp and paper products is likely to

show a growing trend.

In 2006, there were around 77 mills listed in Schedule to the Newsprint

Control Order, 2004 as mills manufacturing newsprint paper – of which 2 in Central

Public Sector, 2 in State Public Sector and 73 in Private Sector. The production of

newsprint has increased at a CAGR of 12.5 per cent over the last 5 years. The

production of newsprint in 2006-07 (April-August 2006) was 420,000 tonnes.

According to the International Newspaper Marketing Association (INMA) estimates

that approximately more than 360.0 million literate people in India are still not

reading newspaper. Thus, increase in the number of newspaper reader would also

increase the demand for newsprint. The demand for newsprint in the country is met

partly from indigenous production and partly by import. Free imports and low

customs duty have made newsprint market competitive. There is no price or

quantitative controls. Various policy measures have been taken to improve production

and availability of newsprint.

The data noted in the Table (3.5) shows the Installed Capacity, Consumption,

Production, Import and Export of Newsprint in India (1983-1984, 1988-1989 to 2008-

2009).

[119]

Table (3.5) : Installed Capacity, Consumption, Production, Import and Export

of Newsprint in India (1983-1984, 1988-1989 to 2008-2009)

Note: #: Import to Consumption Ratio.

*: Up Till Jan. 09 NA: Not Available

Source: Ministry of Commerce & Industry, Govt. of India. (10584)

(In Lakh Tonne)

Year Installed

Capacity

Consumption Production Imports Exports Import

Ratio

(per cent) #

1983-84 - 3.70 1.76 1.94 - 52.00

1988-89 - 5.70 3.20 2.50 - 44.00

1989-90 - 5.60 3.10 2.50 - 45.00

1990-91 - 5.10 2.80 2.28 - 45.00

1991-92 - 5.60 3.20 2.50 - 45.00

1992-93 - 5.40 3.00 2.00 - 37.00

1993-94 - 5.60 3.61 1.50 - 27.00

1994-95 - 7.00 4.02 2.98 - 43.00

1995-96 - 7.50 4.10 3.40 - 45.00

1996-97 7.68 8.50 3.00 5.47 - 64.00

1997-98 7.83 9.00 4.00 4.98 - 55.00

1998-99 9.70 9.50 5.25 4.27 - 47.00

1999-00 10.61 - 5.04 4.39 - -

2000-01 10.83 - 6.34 4.44 - -

2001-02 12.04 - 6.20 4.44 - -

2002-03 12.25 - 6.27 5.20 - -

2003-04 - - 6.8 7.5 0.03 -

2004-05 - - 7.6 6.7 0.05 -

2005-06 - - 9.13 6.85 0.11 -

2006-07 - - 10.32 7.92 0.05 -

2007-08 - - 10.39 8.94 0.04 -

2008-09 - - 9.4* NA NA -

[120]

TRENDS IN AVAILABILITY OF NEWSPRINT IN INDIA Alike paper the availability of news print has also gone up in India over a

period. The data exhibited in the following Table (3.6) shows the availability of

Newsprint in India:

Table (3.6) : Availability of Newsprint in India (1983-1984 and 1988-1989 to

2007-2008)

(Lakha Metric Tonne)

Year Production Import Consumption Import Ratio *

(per cent)

1983-1984 1.76 1.94 3.7 52

1988-1989 3.2 2.5 5.7 44

1989-1990 3.1 2.5 5.6 45

1990-1991 2.8 2.28 5.1 45

1991-1992 3.2 2.5 5.6 45

1992-1993 3.0 2.0 5.4 37

1993-1994 3.61 1.5 5.6 27

1994-1995 4.02 2.98 7.0 43

1995-1996 4.1 3.40 7.5 45

1996-1997 3.0 5.47 8.5 64

1997-1998 4.0 4.98 9.0 55

1998-1999 5.2 4.2 9.5 44

1999-2000 4.5 4.0 8.5 47

2000-2001 6.3 4.4 10.7 41.1

2001-2002 6.5 4.0 10.5 38.1

2002-2003 6.3 5.2 11.5 45

2003-2004 6.9 7.5 14.4 52

2004-2005 7.6 6.7 14.3 47

2005-2006 9.1 6.8 15.9 43

2006-2007 10.3 7.9 18.2 43

2007-2008(b) 10.4 8.9 19.3 46

Note: *: Import to consumption ratio.

a: lakh 105 or 0.1 mn. b: Annualized.

Source: Centre for Industrial & Economic Research (CIER). (652)

[121]

Chart 3.10 Shows the Newsprint Production in India from

2000-2001 to 2008-2009

Chart 3.11 Shows the Import and Export of Newsprint in India

from 2000-2001 to 2008 to 2009

[122]

Graph 3.12 Shows the Production and Growth Rate of Newsprint Sector

From 2000-2001 To 2007-2008

GROWTH DRIVERS

Growth drivers play an important role in the appraisal of any industry.

Keeping in mind the significance of growth drivers, in the following pages, an attempt

has been made to study the major growth drivers of paper industry:

Economic Growth

The Indian economy is expected to grow at 8.5% in 2010-11 and 9% in 2011-

12. With the fundamental strengths and strong advances in private consumption and

investment in next two years, the economy growth is projected at 10% in 2011-12.

Moving forward, India's GDP is set to quadruple over the next ten years and the

country is likely to be a USD 4 trillion economy by 2020. According to the Economist

[123]

Intelligence Unit (EIU), the research arm of London-based Economist magazine,

India is expected to overtake China to become the world's fastest growing economy

by 2018.

Increasing Literacy and Government Thrust on Education

The literacy rate in the country has increased from 18.33% in 1951 to 65.38

per cent in 2001. Thus, in five decades, the literacy percentage had grown by 47.05%

or by an average of 9.41% per decade. The implementation of the Right of Children to

Free and Compulsory Education Act, 2009, which assures free school facilities from

Class I to VIII for children between 6 and 14, translates into a huge demand potential

for the paper industry. The estimated numbers are bound to be huge as the law will

bring on school rolls over one crore students who do not go to school now. Going by

the thumb rule that each student uses about 10 kg of paper a year, enrolment of over

one crore students will mean an additional demand for about one lakh tonnes of paper.

The academic segment demand is growing by about 10% annually as the

student population and paper usage increase. The Governement’s existing Sarva

Shiksha Abhiyan programme for education for all seeking compulsory education

would contribute significantly to increasing the per capita consumption of paper.

The Government has increased the budget allocation for school education by

16% from Rs. 26,800 crore in 2009-10 to Rs. 31,036 crore in 2010-11. Further, the

additional fund allocation to states amounting to Rs.3,675 crore for elementary

education under the Thirteenth Finance Commission grants for 2010-11 will provide

more fillip to the demand of printing and writing paper.

Urbanization, Changing Demographics

Urbanization is an inevitable part of a country’s economic evolution. Indian cities

are home to an estimated 340 million people, or 30% of the population. It is estimated

that India’s population will reach 1.47 billion with around 40% urbanization. That

means close to 590 million will be living in cities which are nearly twice the

population of the USA today. This will be the fastest addition to the urban population

of any country in history outside China, according to a study by the McKinsey Global

Institute (MGI). Unlike other countries grappling with aging population and rising

dependency ratios, India has a young and rapidly growing population. It is estimated

that nearly 180 million new job seekers will enter India’s work force over the next

two decades.

[124]

Increasing Consumerism

The MGI report estimates that India's middle class is expected to increase by

more than ten times from its current size of 50 million to 583 million people by 2025.

And over 23 million Indians (more than the present population of Australia today) are

expected to be counted as billionaires. By 2025, it is forecasted that India will become

the 5th largest consumer market, surpassing Germany. Higher urbanization and

consumerism have been the key drivers for the structural changes in India. The

increasing disposable incomes and lifestyle changes have changed the consumer

outlook and preferences providing a growth thrust to the economy. Further, it is

estimated that the gross domestic savings in India would grow by 3.8 times from

Rs.19 trillion in 2009 to Rs.72 trillion by the end of the next decade. This increased

savings could lead to a huge surge in domestic consumption expenditure which is set

to triple from Rs. 30 trillion in 2009 to Rs.113 trillion in 2020. Thus, India’s large and

growing domestic market with increasing purchasing power and consumerism, are

strong growth drivers for the paper industry.

Service Sector Thrust

As the economy develops on the back of growth in real sectors like

manufacturing, industrial production, agriculture, etc., it is supported by ancillary

services like banking and insurance from the financial services sector. Other critical

services which are expected to grow along with the forward march of the economy are

education, healthcare, recreation and IT services.

The growth in the service sector propels demand for office supplies. To

provide an illustration: It is estimated that for every candidate an IT company recruits,

paper manufacturers sell over five reams, about 2,500 sheets, of copier paper directly

related to the recruitment process in the form of letters, instructions and training

manuals. Backed by demand from the service sectors, the copier paper market is

expected to grow at 14% over the next few years.

Printing Industry

The fast growing printing industry and increasing focus towards niche sector

magazines are the other factors driving growth for paper industry. With a readership

base of over 250 million readers, India is the second largest print market in the world.

Long term prospects for growth remain favourable as there is a population of

[125]

approximately 359 million who are literate but do not currently read any publication

in India. Revenues from newspaper publishing are expected to grow at CAGR of

9.1% over the next 5 years and are projected to reach Rs. 245.4 billion by 2013. The

magazine publishing segment is expected to grow at a CAGR of 8.1% over the next 5

years and is projected to reach Rs. 20.5 billion by 2013. The low cost base of Indian

printing industry is attracting many outsourcing projects from the foreign publishers

and hence it is expected to grow at a CAGR of 15% over the next few years thereby

fuelling further growth in the paper industry (Annual Report of WCPM: 2010).

Map 3.1: Showing Location of Pulp and Paper Industry

[126]

Chart 3.13 Projected Demand and Supply of Paper and Paperboard and

Newsprint from 2005 to 2020.

Source: CPPRI; Research India Analysis

[127]

PRESENT POSITION OF PAPER MILLS IN INDIA

The number of paper mills has also increased in India. There were 515 paper

mills in India in 2000 which now went up 656 units, engaged in the manufacture of

paper and paperboard. Capacity utilization of the industry is just 79 per cent, due to

old technology. Moreover, 194 mills under the purview of the Board of Industrial and

Financial Reconstruction (BIFR) and nearly 60 mills with a capacity of 1.3 million

tones have been closed. Based on the raw material utilized, the paper units can be

classified into three broad categories as:

Wood Based (Bamboo, Hardwood Etc.)

Agro-Based (Bagasse, Jute, Rice and Wheat Straw)

Waste Paper Based

Due to increasing regulation and raw material prices, the companies are

increasing using more non-wood based raw material over the years. Round about 70

per cent of the total production is based on non-wood raw material, in 2006. The

following Table (3.7) shows the Category-Wise Mills in India:

Table (3.7): Category-Wise Paper Mills in India (Figures in number)

Category Capacity Range Number of units Capacity (TPA)

Small Up to 10000 299 12,90,382

<2000 69 75,522

2000–5000 107 2,96,980

5000–10000 123 9,17,880

Medium 10000–20000 116 16,69,460

Large >20000 70 38,93,048

[128]

INSTALLED CAPACITY OF PULP AND PAPER INDUSTRY

IN INDIA

The installed capacity of pulp and paper industry in India has shown alarming

results. The following Table (3.8) shows the Installed Capacity of Pulp and Paper

Industry in India from 1980 to 2008-2009:

Table (3.8) : Installed Capacity of Pulp and Paper Industry in India (1980,

1981, 1986 to 1995 and 1995-1996 to 2008-2009)

Year No. of

Mills

Installed Capacity

(' 000 Metric

Tonne)

Average Capacity

(Metric Tonne)

Index 1980=100

No. Capacity

1980 121 1538 13000 100 100

1981 138 1656 12000 114 108

1986 271 2655 9000 224 173

1987 288 2760 9000 238 179

1988 297 2867 10000 245 186

1989 305 3014 10000 252 196

1990 311 3049 9803 257 198

1991 327 3284 10000 270 213

1992 334 3418 10234 276 222

1993 340 3551 10444 281 231

1994 350 3670 10486 289 239

1995 350 3670 10486 289 239

1995-96 380 4100 10789 314 267

1996-97 380 4200 11053 314 274

1997-98 380 4350 11447 314 283

1998-99 380 4550 11794 314 296

1999-00 380 4900 12895 314 324

2000-01 380 5100 13421 314 332

2001-02 380 5100 13421 314 332

2002-03 385 5500 14286 318 358

2003-04 380 5100 13421 305 332

2004-05 515 7400 14369 426 481

2005-06 568 7600 13380 469 494

2006-07 600 7800 13000 469 507

2007-08 600 7800 13000 496 507

2008-09E 666 8900 13363 550 579

Table: Abbr.: E: Estimates

Source: Centre for Industrial & Economic Research (CIER). (652)

[129]

Chart 3.14 Shows the Raw Material Wise Paper Mills in India

Raw Material-Wise Paper Mills in India

(Figures in number)

Source: DIPP; water and agro industry; Mysore Mills estimates; Research India

analysis

GOVERNMENT POLICY

The Indian paper industry has been historically divided on a three dimensional

matrix identified by size, grades manufactured and raw material utilized. Generally,

tariff rates have protected smaller units utilizing “unconventional” raw material. Over

the years, the growth of various segments, investments levels in specific segments,

technological changes, industry fragmentation and intensify of competition have been

significantly influenced by the government tariff policy (http://www.docstoc.com).

The role of the government is crucial in the Indian paper industry as it plays the role

of regulation, supplier (the wood supplying forests are owned by the government) and

buyer (government is the single largest buyer of paper). The domination of small

paper mills was high in India till nineties. But now these have faded into the oblivion,

as they did not have advantages of economies of scale

(http://www.researchandmarkets.com). The government had completely delicenced

the paper industry from July 17, 1997; foreign participation is permissible. Most of

the paper mills are in existence for a long time and hence present technologies fall in a

wide spectrum ranging from oldest to the most modern. 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

[130]

existing mill in permissible locations. The paper industry is a priority sector for

foreign collaboration and foreign equity participation up to 100 per cent 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 (http://www.economywatch.com).

There is an excellent budget for the paper industry, as the excise cut would

give the sector the necessary boost. The cut in excise duty from 12 per cent to 8 per

cent will give a big relief to paper industry who were struggling to increase their

margin.

Excise duty has been fully exempted on paper and paper products,

manufactured from non-conventional raw materials, up to clearance of 3500 metric

tonnes in a year from a unit. However, this benefit is available only if the unit does

not have an attached wood/bamboo pulping unit. They will also be levied only 8 per

cent excise duty for production in excess of 3500 metric tonnes in a year

(http://www.capitalmarket.com/).

The government has maintained the effective rate of duty on paper, paper

board and articles at 4 percent while raising the duty for certain stationery products

like folders, letter pads and file covers to 8 percent. Notebooks and exercise books

have also been exempted. Apparently, the move will have no impact whatsoever on

paper consumption (http://www.ipma.co.in/).

Central Excise:

Central Excise is levied @8 per cent for the first 3500 MT production and

thereafter @12 per cent on the value of the invoice. The company is availing

permitted MODVAT benefits as per Central Excise regulation. For import duty paid

on waste paper procured from overseas the company is entitled to adjust the entire

duty paid component as that of MODVAT credits.

VAT (value added tax):

VAT replaces the existing multipoint taxes levied by various states with effect

from April’ 05. As that of other industries, the paper trade is also covered under VAT

for domestic sales done in the state of Kerala. However for interstate sales CST is

continued to be levied as per existing Government regulations.

[131]

Service Tax:

Being classified as a manufacturing industry, the industry even for Job Work

on conversion basis will not be subjected to Service Tax requirements. A recent

notification from Central Government also confirms such a stand.

Factory Licenses:

All the licenses required under Municipality Act, Factories Act are obtained

and duly renewed.

Pollution Control:

Necessary permission under effluent discharge Act is obtained and the

facilities required to maintain the permission are in place (http://www.docstoc.com/).

Since the government has already cut down the excise duty by 600 basis

points (in December 2008 by 400 basis points and in February 2009 by 200 basis

points), no future cut is expected in excise duty. Future stress on primary education,

rural education and more allotment of money for the various education schemes is

expected.

Union Budget 2011-2012 (March 01, 2011)

Indirect Taxes The budget proposals have a largely neutral impact on the

paper industry.

Excise Duty:

The excise duty on paper and paperboard has been increased from 4 per cent

to 5 per cent.

(Notification No 2/2011 - Central Excise Dated 1st March, 2011)

Customs Duty:

The basic custom duty on paper and paper board has been retained at 10 per

cent. The custom duty on wood pulp has also been retained at 5 per cent. However the

custom duty on waste paper has been reduced from 5 per cent to 2.5 per cent.

[132]

Union Budget 2010-2011(March 01, 2010): Indirect Taxes

The Union Budget 2010-11 was tabled on February 26, 2010 in the

Parliament. No significant budget proposals have been made impacting the paper

industry.

Excise Duty:

The excise duty on paper and paperboard has been retained at 4 per cent.

However excise duty @ 10 per cent is imposed on some of the paper products viz

baby and clinical diapers and sanitary napkins which were fully exempt hitherto.

Also, excise duty on cartoon, boxes and cases of corrugated paper and paperboard

manufactured by standalone manufacturers is reduced from 8 to 4 percent.

(Notification No 10/2010 - Central Excise Dated 27th February, 2010)

Customs Duty:

The basic custom duty on import of paper and paperboard is retained as 10 per

cent as before.

Exemption from 4 per cent additional duty of customs (Special CVD) is

provided on import of waste paper and paper scrap affected by the traders. However,

there is no change in its tariff structure in case of import by the Actual Users.

(Notification No.24/2010 – Customs dated 27th February, 2010)

(Feb 24, 2010) High Court admits IPMA’s petition on safeguard duty

The decision of the Directorate of Safeguards, Department of Revenue,

Ministry of Finance, and Government of India to not recommend safeguard duty on

paper and paper board imports has come as a rude shock to the industry which is

reeling under the impact of unbridled imports for a while now.

A writ petition with a prayer to quash/set aside the impugned notification

dated 13th November 2009 issued by Directorate of Safeguards to not impose

safeguard duty on imports of coated paper & board has been admitted by a division

bench of the Delhi High Court.

[133]

The court has issued notices to the government of India and the Director

General of Safeguards (DGS) directing them to reply to the petition. The court has

listed the matter for hearing of May 11, 2010 (http://www.ipma.co.in/ ).

PAPER POLLUTION

Pulp and paper mills generate varieties of pollutants depending upon type of

the pulping process being used. The production, use and recycling of paper has a

number of adverse effects on the environment which are known collectively as paper

pollution. Pulp mills contribute air, water and land pollution. Discarded paper is a

major component of many land-fill sites, accounting for about 35 per cent by weight

of municipal solid waste (before recycling). Even recycling paper can be a source of

pollution due to the sludge produced during deinking.

PROBLEMS FACED BY PAPER INDUSTRY IN INDIA

The sharp rise of prices during 1973-74 created a paper crisis in the country.

Since then, the paper industry was engulfed in a crisis due to a variety of reasons,

leading to a sub-optimal use of installed capacity (Datt: 2002).The financial

performance of paper mills has been highly unsatisfactory despite numerous facilities

and fiscal concessions being provided to them. To understand the broad implications,

it is necessary to know the problems being confronted by the industry (Reddy: 2003).

Fig. 3.2

[134]

Raw Materials

The problem of getting adequate supplies of cellulosic raw materials on a

regular basis at a reasonable cost is the main problem in our paper industry. At present

about 64 per cent of paper production is based on non conventional raw materials

such as agro residues and recycled fiber and only 36 per cent paper production comes

from good quality of cellulosic raw material i.e. forest resource. Sustained availability

of low cost and good quality of cellulosic raw material is one of the major factors

inhibiting the growth of paper industry. Amongst the cellulosic raw materials,

bagasse, straw and waste paper have inherent drawbacks of limited and scattered

availability of suitable technology for conversion into higher grade pulp.

Obsolete Technology

Most of the paper mills operating in India are very old and are using outdated

technology including plant and machinery. Whatever plant and machinery is

manufacture in India, it is available at a high cost. Even the available supplies are not

in a position to meet the entire machinery needs of the industry. Except a few mills,

most of the paper mills in India operate on technologies which are more than 30 years

old compared to average mill in Europe.

Finance

In order to make the size of operations international competitive, investments

are becoming very high. The industry will have to take recourse to international funds

and overseas joint venture partnership.

High Cost of Basic Inputs

The growth of paper industry is largely affected by inadequate availability of

energy i.e., coal and power. Steep hike in the cost of basic inputs viz. chemicals and

raw materials is posing serious threat to the very existence of paper mills.

Poor Profitability

Poor profitability is one of the problems of paper industry. Under capacity

utilization, higher costs of production, industrial dispute and financial management

are some of the reasons for poor profitability.

[135]

Environmental Issues

The production, use and recycling of paper has a number of adverse effects on

the environment which are known collectively as paper pollution. The Indian industry

recognizes that it is a polluter. The paper industry releases chlorinated compounds,

dioxins and furans, wastewater are known to carry high levels of BOD, COD and

suspended solids. On the atmospheric side, the industry faces the daunting task of

tackling the emission of non-condensable gases. The problem of solid waste disposal

is also a major concern to the industry in the face of local environmental pressures.

Under Utilization of Capacity

Capacity utilization rate has been declined over the years. This is due to the

availability of inadequate raw material, finance, lack of skilled manpower.

Research and Development

Till 1980, there was no organization involved in the research and development

in paper industry. Research and development status in the paper industry is still in its

infancy and the only organization equipped to undertake industry oriented applied

research on modem lines is the Central Pulp and Paper Research Institute (CPPRI),

established in 1980. There is lot of ground to be covered in research and pulp wood

plantation development if the paper industry is to develop along the right lines and

meet the challenges of future.

Lack of Skilled Manpower

The total manpower cost per tonne of product is quite high. Manpower cost in

paper industry in India varies from 8 percent to 16 percent of the total production cost.

The industry has also the difficulty of obtaining floor-level technicians with technical

background. More than 80 percent of the employments are in production departments,

research and development accounting for only one percent of the total task force. One

of the main reasons for very low capacity utilization is the acute shortage of skilled

manpower (Reddy: 2003).

Competition in Global Market

Quality products at competitive price are necessary for effective global

competition. The Indian paper mills are facing quality problems due to lack of good

quality cellulosic raw materials available in the country.

[136]

Sickness

From the very beginning, the small units have suffered from various

constraints. They did not have chemical recovery plants, nor did they provide for

disposal of effluents. They had installed second hand machinery imported from

elsewhere and they made use of unconventional raw materials. As a result, the small

paper units found it difficult to operate efficiently, to maintain quality of paper or

produce at a low cost (Datt: 2002).

Other Problems

Some other problems faced by paper industry in our country are:

Poor infrastructure,

To many administrative hurdles,

Tedious bureaucratic methods,

Poor productivity,

Poor instrumentation,

Lack of commitment to innovation,

Poor recycling of waste paper,

Regional barriers,

Decolourization and detoxification air pollution problem,

Recovery of chemicals from agro based black liqueur,

Political interference and

Competition from global competitors

SWOT Analysis of Indian Paper Industry

Competitive strengths:

Large and growing domestic paper market.

Relatively low personnel and fuel costs.

Well developed printing industry.

[137]

Competitive Weakness:

Fibre shortage.

Small and fragmented industry structure.

Environmental problems of most of the small pulp mills and also some big

mills.

Impact of high local taxes (sales tax, entry tax etc.)

Competitive Opportunities:

Enormous domestic market potential.

WTO: foreign participation/ FDI would speed up restructuring.

Low labor cost.

Competitive Threats:

Unprepared mills for international competition.

Decline in capacity.

Short term planning for raw material (http://reviewessays.com/).

SUGGESTED REMEDIES:

To overcome the problems faced by the paper industry, the following

suggestions will go a long way and the worst will be over permanently:

Raw Material

In order to overcome the problem of inadequacy of raw materials, industry has

to go for plantation programmes for self-sufficiency in raw material. It would be in

the long term interest of the country to encourage units based on unconventional raw

materials and to help bigger paper mills to switch over gradually to unconventional

raw materials. Government should encourage growth of large-scale plantations of

eucalyptus plants particularly in south India which has suitable soil for the plantation

of eucalyptus.

[138]

Jaakko Poyry Consulting Company study recommended that small percentage

(about 5 per cent) of degraded lands should be converted as “production forest” by

having corporate involvement in the plantations. Degraded forest lands should be

identified by state governments and offered to industry on long leases for plantations

(Mathur: 2009).

Technology Upgradation

The industry should be helped to optimize capacity utilization through

renovation and modernization of existing large mills. Modernization programme is

possible with the proper evaluation of projects and proper planning.

Infrastructure

Improvement of communication e.g. rail, road, port which will help the entire

industrial sector.

Royalties and Leases

Government should reduce the present rates of royalties for the leases of the

forestland. Policy should be stable and based on long-term basis.

Research and Development

To meet the challenges of future, the paper industry should set up more

research and development institute.

Finance

Paper industry should adopt effective control of operating costs for the

improvement of financial health. Adoption of profit planning and control techniques

such as marginal costing, cost-volume-profit analysis, standard costing, activity based

costing system may enable the mills to push down the operating costs and boost up

the profits. Product mix is the other way of improving profitability of the mills. For

instance, mills instead of selling paper, as it is, they may convert them into paper

product like notebooks so that marketability will be more effective (Reddy: 2003).

[139]

Utilization of Capacity

Industry must utilize the capacity up to maximum level. For meeting the future

demand the industry have to create an additional capacity through the expansion of

existing mills and setting up of new mills.

Global Competitors

Now-a-days the strategy for companies is “go global or go home”. So, to

compete globally in terms of quality and cost, it is imperative to produce products of

uniform quality and maintain consistency in quality to reduce rejections.

Government Policies

Social forestry scheme should be introduced to small and marginal farmers to

promote sapling and knowhow for raising plantations of fast growing trees with an

assurance of a buy back at a remunerative price. Right now, an estimated 55 million

bagasse is available, but currently industry uses only 8 per cent. Bagasse can be

introduced in replace of using bamboo, rice or white straw. There should be more

uniform cost effective power policy for paper production units/mills

Environment

The old method to treat environment issues is no longer effective; therefore,

overall strategy needs to be adopted to select proper process and equipment, and

maximum segregation of effluents which should be treated selectively.

Paper industries in India certainly flourish in future, if it is able to solve the

problems in front of it. At present the paper industry is at cross roads with the above

mentioned problems. Therefore, the industry has to take all the above mentioned

problems as challenges and try to overcome the problems and bring back the industry

into profitable position.

[140]

CONCLUSION

The foregoing discussion traced that the Indian paper industry is a booming

industry and is expected to grow in the years to come. The usage of paper cannot be

ignored and this awareness is bound to bring about changes in the paper industry for

the better. It is a well known fact that the use of plastic is being objected to these days.

The reason being, there are few plastics which do not possess the property of being

degradable, as such, use of plastic is being discouraged. Excessive use of non

degradable plastics upsets the ecological equilibrium (http://www.economywatch.

com/). Indian paper and newsprint industry has a huge potentials and prospects in

coming future. In our, country, demand for paper and newsprint is rapidly increasing.

The wood and paper industry is probably the only large-scale industrial system which

is genuinely capable of satisfying future requirements with respect to sustainable

development.

The globalization of Indian economy has lead to a healthy growth of 6 to 7 per

cent industry and that is growth happening in all the sectors. Moreover the per capita

consumption of paper in India is going up. Due to environmental concerns, the use of

plastics is likely to be banned by the government of India within a short span of time.

Hence within 2 to 3 years industry will be witnessing an explosive growth of

packaging in India mainly in food, textile and export segments.

To face future challenges, the Indian Paper Industry has been focusing on

repositioning of product lines, improving internal efficiencies and making investments

in expansion and building production capacities and to further penetrate in the global

market. Obviously it is showing its preparedness to meet the challenges

(http://reviewessays.com/). Reading a book will remain a great pleasure into the

future and paper, as a ubiquitous material with its many uses, will continue to play an

influential role. Many artists will continue to express themselves by using this most

versatile material.

Thus, after having discussed a detailed account of growth and development of

Indian Paper Industry, the researcher moves on to the main task i.e. performance

appraisal of some selected paper mills in India. In the next chapter, our aim would be

to make a through survey of four selected sample paper mills.

[141]

REFERENCES:

1. Ahuja, S. P. (1980), “Paper industry in India-Retrospect’s, Prospects and

Directory” New Delhi: The Institute of Economic and Market Research. p.21

2. Bora, Khagen (2008), “Energy Management in Pulp and Paper industry: A

Case Study of Cachar Paper Mills” M.B.A Thesis, Faculty of Economics and

International Centre for Promotion of Enterprises (ICPE), Ljubljana

University, Ljubljana. Retrieved from: http://www.cek.ef.uni-lj.si/magister/

bora134-B.pdf

3. Datt, Ruddar; Sundharam K. P. M (2002), “Indian Economy” S.Chand &

Company Ltd., New Delhi. pp.649-650

4. Kulshrestha N.K. (1988), “Analysis of Financial Statements of Indian Paper

Industry” Navman Prakashan, Aligarh. pp. 1-2

5. Mathur, R. M; Thapliyal B. P; et.al; (2009) “Challenges Confronting Indian

paper Industry In Changing Scenario” Indian Pulp and Paper Technical

Association, Vol.21, No.3 Issue July-September’ 2009. pp.95-98

6. Reddy, G. Sudarsana; Reddy, P.Mohan; et.al. (2003), “Paper Industry in

India- Problem and Prospects” The Management Accountant, Vol.38, No.12,

pp. 904-905, 910-911

7. Sivayya, K. V.; Das, V. B. M. (1985), “Indian Industrial Economy” S.Chand

& Company Ltd., New Delhi. pp. 423-424

Websites:

8. “Indian Paper Industry” January 2008, Retrieved from http://www.scribd.

com/doc/53624816/indian-paper-industry-1223576792555903-8

9. “Indian Paper Industry” Retrieved From http://reviewessays.com/print/India-

Paper-Industry/52085.html

[142]

10. “Indian Paper Industry” Retrieved From http://www.scribd.com/doc/

43946384/Indian-Paper-Industry

11. “Overview of Paper Industry” Retrieved from http://www.docstoc.com/docs/

12163796/PAPER-INDUSTRY

12. “Overview of Paper Industry” Retrieved from http://www.docstoc.com/docs/

12163796/PAPER-INDUSTRY

13. “Paper” Retrieved from http://stationery. indiabizclub.com/

14. “Pre Budget News” http://www.capitalmarket.com/cmlinks/story210.asp?

S.No=221728

15. Chapter 11 “Pulp & Paper” Retrieved from http://www.pcra.org/english/

latest/book/11-chapter-11.pdf

16. Countdown to Budget 2005-2006 “Role of the Paper Industry in India’s

Economic Growth” Retrieved from http://www.capitalmarket.com/CMEdit/

SFArtDis.asp?SFSNo=1205&SFESNo=72 February 26, 2005

17. Economy watch “Indian paper Industry” Retrieved From

http://www.economywatch.com/world-industries/paper/indian.html

18. India News, Retrieved from http://www.indianews.com/business/20070911/

69729.htm

19. Indian Industry Tracker “Paper Industry” by Sonal Thakur, Retrieved from

http://industrytracker.wordpress.com/2011/04/19/paper-industry/April19, 2011

20. Indian Paper Manufacturers Association “Indian Paper industry” Retrieved

from http://www.ipma.co.in/news_events.asp

21. Indian Paper Manufacturers Association “Indian Paper industry” Retrieved

from http://www.ipma.co.in/news_events.asp

[143]

22. Jais, Vaiv “An overview of the Paper Industry in India” Retrieved From

http://business.ezinemark.com/an-overview-of-the-paper-industry-in-india-

17c36192276.html April 14, 2011

23. Jais, Vaiv “Diversified Uses of Paper Products” Retrieved From

http://business.ezinemark.com/diversified-uses-of-paper-products-

16e6a345691.html November 20, 2010

24. Mathur, R. M; Thapliyal B. P; et.al; (2009) “Challenges Confronting Indian

paper Industry In Changing Scenario” Indian Pulp and Paper Technical

Association, Vol.21, No.3 Issue July-September’ 2009.p. 96

25. Mehra, Nishant; Srivastava, Leena; et.al; “Pathways to Green Publishing-a

stakeholders’ dialogue on ecological and sustainable publishing practices”

Retrieved From http://www.teriin.org/events/greenpublishing/pdf/tpevent

background.pdf pp. 6-7

26. Paper Industry “Introduction on Paper Outlook Industry” Retrieved From

http://www.economywatch.com

27. Paper online “History of paper” Retrieved from http://www.paperonline.org

/history-of-paper

28. Paper online “History of paper” Retrieved from http://www.paperonline.org/

history-of-paper/timeline

29. Paperlinx, Retrieved from http://www.paperlinx.com/cpa/htm/htm_paper_

history.asp?page_id=56

30. Post Budget Report, Retrieved From http://www.capitalmarket.com/

cmlinks/postreport.asp?SNo=223246 February 29,2008

31. Research and Markets “Indian Paper Industry” Retrieved From

http://www.researchandmarkets.com/reports/2392/indian_paper_industry

January 2001

[144]

32. Shah, Purvi “West Coast Paper Mills Limited. BSE Code: 500444 NSE

Id:WSTCSTPAPR”

http://purvismultibaggerstockideas.blogspot.com/2010/07/west-coast-paper-

mills-limited-bse-code_26.html July 26, 2010

33. The free dictionary by Farlex, “Paper” Retrieved from http://www.

thefreedictionary.com/paper

34. Tiwari, Lalit “History of Paper Technology in India” Retrieved from

http://www.infinityfoundation.com/mandala/t_es/t_es_tiwar_paper_frameset.h

tm

35. West Coast Paper Mills Limited “Annual Report 2010” Retrieved From:

http://www.westcoastpaper.com/