Presenting her maiden budget, Finance Minister Nirmala Sitharaman announced 10 per cent customs duty on newsprint and 5 per cent custom duty on imported books in July this year.
The customs duty slapped by the government, expectedly lowered the profitability and increased financial burden on the newspaper industry.
But the government holds that the decision to impose custom duty on newsprint through budget is in line with ‘Make in India’ programme that was actually launched to “encourage companies to manufacture their products in India and enthuse them with dedicated investments into manufacturing.”
In a reply to the CPI Rajya Sabha member, Binoy Viswam, Minister of State for Corporate Affairs, Anurag Thakur stated that the decision to impose 10 per cent customs duty was taken
1. to provide level playing field to the domestic newsprint manufacturer
2. to promote the objective and spirit of the ‘Make in India’ policy
“This issue was examined and customs duty of 10 per cent has been imposed to provide level playing field to the domestic newsprint manufacturers. This is also in line with the Government of India’s policy to promote Make in India,” reads the letter, sent by Thakur.
Ironically, as per experts, about 50-70 per cent newsprint is imported through Russia, Canada and China.
A former employer of the TOI group told on condition of anonymity that due to surge in the cost of the newsprint, the print industry is facing sharp decline in profit.
“Already stressed and declining industry is facing crisis as on the one hand ad revenue has gone down and cost of the newsprint has been increased on the other. Both these factors have together caused a huge loss to the industry. Increasing customs duty on the newsprint is the last straw on the camel’s back,” he added.
Terming the government’s decision as “a bid to hide its ulterior motive in the name of promoting domestic manufacturer”, Viswam said that the logic provided by the government “does not hold grounds as it has followed a series of direct or indirect steps by the current regime to gag the media and put restriction on what can be published and what cannot.”
Viswam said, “Decision to impose 10 per cent customs duty is a draconian measure to burden newspapers with higher input costs and force them to subjugate.”
Calling it a retrograde step, though industry leaders demanded roll back, FM Sitharaman had turned down the demand, saying, “If we are talking of Make in India but allowing indirectly to import, it does not make sense at all”.