Finance minister rejects demands for rollback of import duty on newsprint

Rejecting demands for rollback of import duty on the paper used for printing newspapers, Finance Minister Nirmala Sitharaman on Tuesday said 10 per cent customs duty on imported newsprint was a move to provide a level playing field for domestic manufacturers.

Replying to the debate on Finance Bill 2019, which contained the tax proposal, in the Rajya Sabha, she said domestic newsprint manufacturers were finding it difficult to find buyers because the same was being imported.

"Basic Customs Duty on newsprint has been increased to provide a level playing field to domestic manufacturers. There is a capacity in this country to produce newsprint. But unfortunately, they are not able to get buyers because most of the newsprint is imported," she said.

In the last few months, there has been a drastic fall in price overseas from $700 per tonne to $500 per tonne, she said, adding that kind of fall in global newsprint prices has affected the Indian manufacturers so badly that they are not able to find takers for their product.

"So if we are talking of Make in India but allowing indirectly to import, it does not make sense at all. I am sure the member appreciate this point that when we are trying to make Indian industry survive this kind of onslaught, this is inevitable," she said.

Sitharaman was responding to YSR-Congress leader V Vijayasai Reddy, who during the debate stated that the duty would adversely impact small newspapers at a time when advertising revenue was also depleting.

"You cannot allow fall in international price adversely affecting when we have capacities. If we did not have capacities, I can fully understand. I want members to please appreciate," the minister said.

"I also want to say newsprint attracted basic customs duty even before 2009. We are not the first ones to put it here," she added.

Earlier this month, the Indian Newspaper Society (INS) asked the government to withdraw the 10 per cent customs duty imposed on newsprint, the uncoated paper used for printing of newspapers, and lightweight coated papers used for magazines.

"Publishers of newspapers and magazines are already reeling under severe financial pressure due to many factors like lower advertisement revenues, higher costs and digital onslaught from technological giants. Small and medium newspapers will go into deeper losses and many of them will be forced to close down," it had said.

India's newsprint consumption is around 2.5 million tonnes per annum while the domestic industry's manufacturing capacity is only 1 million tonnes. Also, there are no domestic manufacturers of uncoated and lightweight coated paper.