Govt hikes import duty, agarbatti & bamboo industries to get big boost

The Centre’s move to increase duty on bamboo, mostly imported from China and Vietnam, will be a big boost for the agarbatti and bamboo-based industries in India and are expected to create at least one lakh selfemployment in the next 8-10 months.

 The Finance Ministry on Tuesday increased the import duty on bamboo from 10% to 25% after Union MSME Minister Nitini Gadkari took up the matter of heavy Chinese import with PM Narendra Modi. Gadkari reportedly told the PM that unchecked import of bamboo sticks from China and Vietnam was essentially killing the local industry and had resulted in huge employment loss in India.

This decision will pave the way for setting up of new incense stick manufacturing units to meet the ever-growing demand of agarbatti in India. At present, the consumption of incense sticks in India is pegged at a whopping 1,490 tonne per day but only 760 tonne per day is locally produced. This huge gap between the demand and supply had resulted in heavy import of raw agarbatti. Consequently, the import of raw agarbatti increased from just 2% in 2009 to 80% in 2019.

However, on request of Khadi and Village industries Commission (KVIC), the Ministry of Commerce on August 31, 2019, placed the import of raw agarbatti under “Restricted” category. This import restriction led to revival of hundreds of agarbatti units in states like Maharashtra, Madhya Pradesh, Uttar Pradesh, Gujarat and several Northeastern states.

KVIC chairman V.K. Saxena said this decision will strengthen the agarbatti as well as the bamboo industry in India. “India is the second largest producer of bamboo in the world but ironically, it is also the second largest importer of bamboo and its products. The hike in import duty on bamboo sticks from 10% to 25% will curb heavy import from China and encourage local manufacture in agarbatti and bamboo industries. We are expecting now India will become ‘aatamnirbhar’ in agarbatti production soon which will create thousands of new jobs,” he said.

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