The Indian paper industry accounts for about 3% of the world’s production of paper. The estimated turnover of the industry is INR 50,000 crore (USD 8 billion) approximately and its contribution to the exchequer is around INR 4,500 crore. The industry provides employment to more than 0.5 million people directly and 1.5 million people indirectly.
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 mills use a variety of raw material viz. wood, bamboo, recycled fibre, bagasse, wheat straw, rice husk, etc.; approximately 31% are based on wood, 47% on recycled fibre and 22% on agro-residues. The geographical spread of the industry as well as market is mainly responsible for regional balance of production and consumption.
The operating capacity of the industry currently stands at around 13 million tonnes. During 2015-16, domestic production is estimated to be 12.2 million tonnes. As per industry guesstimates, over all paper consumption has now touched 13.9 million tonnes and per capita consumption is pegged at 10 kg. Demand of paper has been growing around 8% per annum for some time. So far, the growth in paper industry has mirrored the growth in GDP.
India is the fastest growing market for paper globally and it presents an exciting scenario; paper consumption is poised for a big leap forward in sync with the economic growth. The futuristic view is that growth in paper consumption would be in multiples of GDP and hence an increase in consumption by one kg per capita would lead to an increase in demand of 1 million tonnes.