Mumbai: The Indian Paper Manufacturers Association (IPMA) has raised alarms about the surging imports of virgin fibre paperboard (VFP), which threaten the viability of domestic producers. Imports of VFP, primarily used in packaging for the pharma, FMCG, and cosmetics sectors, have skyrocketed, recording a staggering 21,233 tonnes per month during the first half of FY25—an increase from just 6,337 tonnes monthly in FY22. In August and September 2024, imports exceeded 30,000 tonnes monthly, accounting for over 20% of domestic demand.
A major contributor to this influx is China, which increased its shipments by 44% in the same period, with significant inflows from Chile and ASEAN countries. Domestic manufacturers argue that these imports, priced below production costs, undermine local investments and capital expansions. Despite India’s sufficient production capacity, low utilization rates persist due to this unchecked competition.
In response, IPMA has recommended raising the basic customs duty on paper and paperboard imports from the current 10% to 25%, emphasizing that the WTO-bound rate is as high as 40%. This proposal aims to level the playing field and safeguard local industries struggling with economic viability due to predatory pricing by exporters.
The association has presented its recommendations during pre-budget meetings with the finance and commerce ministries, urging swift action to protect India’s domestic paper sector, which has already invested heavily in production infrastructure.
Source: Web Team, C6N
