Sector report: Paper
Inputs
Wood, waste paper, wood pulp, jute, straw, bagasse, caustic soda
Key players
Andhra Pradesh Paper, Ballarpur Industries, Tamilnadu Paper, ITC Bhadrachalam, JK Corp, Orient Paper, West Coast Paper.
Tax structure
| Basic Customs Duty |
(%) |
| Item |
1999-2000 |
| Paper and paper board |
30 |
| Newsprint |
5 |
| Waste paper |
5 |
| Wood pulp |
5 |
| |
|
| Basic Excise Duty |
(%) |
| Item |
1999-2000 |
| Paper and its articles |
16 |
| Wood pulp and waste paper |
16 |
Background
- The prospects of the Indian paper industry are dependent on the international prices of pulp, waste paper and caustic soda. It should be noted that raw material contributes 40-60 per cent of paper cost.
- Paper manufacturing is an energy-intensive process. Power tariffs have major impact on the industry.
- The demand for paperboard is dependent upon growth of end-user industries such as fast moving consumer goods, pharmaceuticals, cigarettes etc.
- In 1999-2000, the domestic newsprint industry was adversely affected by the government's decision to reduce import duty to 5 per cent.
- The domestic writing and printing paper industry fared fairly well in 1999-2000, largely due to the increase in basic import duty from 20 per cent to 30 per cent.
Expectations from the Budget
- No major changes expected in excise duty.
- Import duty on wood pulp and waste paper may be reduced.
- The government is expected to take a decision on using degraded land for commercial plantation.
ALSO SEE:
What will Yashwant Sinha do?
How will personal taxes change?
Fiscal report card
SECTOR ANALYSIS:
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