Andhra Pradesh gets India’s single biggest FDI of worth $3.5 Bn for Paper and Pulp Industry

Published Date | 2019 January 16

The Single biggest FDI, worth USD 3.5 Billion for Paper & Pulp Industry in Andhra Pradesh will propel the Indian Paper Market over the forecast period.
India: Indonesian paper and pulp giant Asian Pulp and Paper Group is announced that they will setting up a single largest FDI, which will be a  world’s largest  Paper Mill in a single site, in Prakasam  district of Andhra Pradesh, India. According to their official, it will produce 5 millions tonnes annum and will mainly focusing on producing packaging paper, specialty paper as well as writing and printing paper. Andhra Pradesh Economic Development Board, CEO J Krishna Kishore said “I understand that the $3.5 billion investment is India’s biggest FDI in a single site, greenfield project till date. It will create 4,000 direct jobs and about 10,000 indirect jobs apart from benefiting over 50,000 pulpwood farmers.” Also, Indian Paper Manufacturers’ Association secretary general Rohit Pandit  said “It would be by far the largest paper unit in the country. In the last 4-5 years, the paper industry has been under stress because of raw material shortage and imports that have been coming in at 0% import duty under the FTA signed by India, especially with Asian countries. Pulp IndustryAccording to Blueweave Consulting , Indonesian’s Paper and Pulp giant Asian Pulp and Pulp investment will give a boost to deserted domestic market of paper industry of India. In last 4-5 years, Paper and Pulp Industry of India has been suffering major losses due to shortage of raw materials ,decrement in demand, more adaption of digital technology by primary schools level of student and government’s employees, zero percentage import duty levied  by Indian government on Asian countries like China and Korea etc. are major factors . But this investment will give major boost to domestic farmers , smaller suppliers of raw materials, which will create more market demand among  various paper industries. Apart from demand creation and infrastructure, It will create 15000 jobs directly and non-directly and give better prices to pulpwood farmers. This Greenfield Project, will again back old days of Paper and Pulp industry of India by lowering of prices  of papers which would be adaptable to all income levels of society and this market demand can give options to domestic competitors to low down prices of paper. Major driving factors for this Pulp and Paper Industry are annually increment in income levels of various groups of societies, Improvement in Literacy rate specially in primary levels  which  are demanding of more papers, major expansion in FMCG sector which are demanding of better quality packaging  . In upcoming years, packaging industry will boost major than paper industry because of major demand in retail sector for example Big Bazar, Woodland, Pantaloons etc. are using paper bags in place of plastic bag, boosting in online food delivery industries like swiggy, food panda ,uber eats  etc. will constantly boost this packaging industry along with paper and pulp industry. According to Blueweave consulting’s upcoming reports, Titled-“India Pulp and paper market size and forecast, 2019-2025”: Paper and Pulp Industry of India is estimated to grow with a significant growth rate  in  forecast period due to high investment through FDI’s Policy, increment in demand of food packaging, government policy on ban of use of plastics which will create more demand of papers in place of plastics packaging, growth  in retail sectors demand of more paper in place of plastic packaging, lower taxation on paper and packaging industry by government. Rapid urbanization and increase in income levels of various society levels will create more demand of paper.