Silchar, Aug. 21: Hindustan Paper Corporation, a public sector company which owns the Cachar Paper Mill at Panchgram, 24km from here, has sought Rs 22 crore to modernize the plant.
This was revealed by the corporation’s chairman and managing director M.V. Narasimha Rao in a meeting with senior officials of the mill during his two-day visit to the plant in Hailakandi district last week.
He said the scheme would help to meet some non-plan expenditure of the mill and buy new machinery to augment the quantity and quality of produced paper.
Rao expressed his “displeasure” with the Centre and the state government for “their indifference” to repeated pleas for reduction in excise duty on sale of processed high quality paper by 50 per cent and a subsidy on transportation of raw materials and finished commodities besides a rebate on agriculture cess in Tripura.
The CMD, however, announced that negotiations with the Mizoram government to ease restrictions on the supply of muli bamboos, primary raw material for churning out paper, had been successful and the supply of bamboo was likely to resume next month.
A Canadian consultancy firm, engaged by the Union ministry of heavy industries and public enterprises to revive the sick mill a few years ago, had suggested measures to upgrade paper production technology and to tone up its working capital availability.
The mill, which commenced production in April 1988, could surpass its annual target output of 1 lakh tonnes only twice in 2005-06 and 2006-07 fiscals.
Sources said problems in procuring raw material led to the plant being able to acquire only half of its annual requirement of 2,50,000 muli bamboos in the past few years.
As a result, the mill faced a financial crisis with the annual output being only 60,000 tonnes of paper since 2007.
Depletions in bamboo stocks has stopped operations at least five times since January this year.
The plant has also been hit by the spiralling prices of bamboo, which shot up from Rs 1,020 per tonne in 2005-06 to Rs 4,231 per tonne at present.
The flowering of bamboo plants in Mizoram has also caused problems.
Sources said bamboo trade cartels in Dima Hasao have also been responsible for shortage of the raw material.