Keep paper in negative list: ASSOCHAM

New Delhi, Feb 17 (IBNS) Industry body ASSOCHAM on Friday urged the government to protect the paper and paperboard industry by keeping its products in the negative list while signing bi-lateral and multi-lateral trade treaties.

In various free trade agreements that India plans to sign in future, the import duty is sought to be reduced in a phased manner. The industry's output is used in educational, printing and packaging sectors.

It is important to keep paper and paperboard industry belonging to the core sector outside the ambit of FTAs and recognise it as sensitive deserving special treatment, said The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

"The paper and paperboard industry has made significant investments to ramp up capacities for meeting domestic requirements," said secretary general D.S. Rawat.

"It has strong backward linkages with the farming community from whom wood (the raw material) is sourced," he said in communication to the ministry of commerce and industry.

About five lakh farmers are engaged in growing plantations of eucalyptus and subabul over 10 lakh hectares. On the other hand, economic slowdown in developed countries and export-dependent economies has led to excess capacity.

Taking advantage of low customs duty rate of ten per cent, these countries find India as an attractive outlet for diverting their excess inventory, said Rawat. "Increased imports are severely impacting the economic viability of many paper mills in India."

To provide a level-playing field to the domestic industry, the customs duty for import of paper and paperboards should be increased and this category kept in the negative list with no preferential treatment in bi-lateral and multi-lateral trade treaties and agreements, he said.