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INS urges government to exempt custom duty on newsprint

The request has come in the wake of the Ukraine-Russia war crisis and economic slowdown due to the pandemic

Indian Newspaper Society (INS) has requested the government to remove the 5% custom duty on newsprint amid the Russia-Ukraine war crisis situation, INS President Mohit Jain told

Mohit Jain

Jain said that he recently met the Ministry of I&B Secretary, Apurva Chandra, and is further seeking a meeting with Union Minister Anurag Thakur to discuss the situation. “We have asked the government if they can remove the 5% customs duty on newsprint. We have placed a request to the government and we hope they consider it,” Jain said. 

He also said that they have asked the government if the newspaper mills in India can make more newsprint and not just more writing material. 

The ongoing Russia-Ukraine war has left newsprint publishers in a soup with only a few weeks of newsprint stocks remaining. India imports about 45% of its newsprint from Russia and 40% from Canada, while 15% of the rest is also imported from other markets in Europe, Australia, New Zealand, Malaysia, and Indonesia. 

In 2020, the government reduced the custom duty on newsprint uncoated paper (glazed) and light-weight coated paper used to print newspapers and magazines from 10% (proposed in Financial Bill 2019) to 5%. 

Jain said that some players had inventories for two months but now only two weeks of inventory remains with them. He said that three shipping lines, called MAERSK, MSC and CMA-CGM, respectively control about 60% of global container traffic, but as a part of economic sanctions put on Russia, they have decided not to call on its ports. 

“St Petersburg is the largest port in Russia but they (shipping lines) have refused to mobilise stock from there. As a result, a lot of raw material is stocked up at St Petersburg. We are also unable to locate ships that have left from this port. This is just adding to the confusion. Rotterdam is a very big shipment port in the Netherlands and it is a port that is used for Europe and Trans-Atlantic cargo coming from America. This also passes through Rotterdam; hence port congestion has happened.”

According to a recent report by Crisil, the newsprint prices are going higher, leading to increased publishing costs for the newspaper industry which had very recently suffered multiple blows during the Covid-19 pandemic.

Rakshit Kachhal, Associate Director, Crisil Ratings, said in the report, “Operating margins of print media companies are seen contracting to 6.0-6.5% next fiscal from 9-9.5% this fiscal because of elevated newsprint prices. This is despite the rationalisation of newsprint consumption and the expected increase in cover prices. India imports more than half of its total newsprint demand. Russia is a major exporter, so its war with Ukraine could affect the demand-supply situation and impact newsprint prices.”

The war is not the sole reason behind the surge in print prices. It must also be noted that due to the economic situation, transportation costs in countries have escalated this is why a few players have increased their prices over the past two years. 

“Today, newsprint is being quoted above $1,000 per tonne, which has increased from $450 per tonne in 2019. This has put a big financial stress on players,” said Jain. 

He further said, the situation has forced players to see if low-quality material from India can be used.

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