Enhanced Import Duty on Bamboo Sticks

The Government of India had recently announced that the import duty on bamboo sticks is to be increased from 10% to 25%. This is to have great impact on Agarbatti industry creating at least 1 lakh new jobs according to KVIC (Khadi and Village Industries Commission).

Background

The decision of enhancing the import duty was taken by the Ministry of Finance to discourage heavy import and help local industries grow. This has great importance as the import of bamboo sticks from Vietnam and China caused huge employment losses in India.

Steps taken

In 2019, the Ministry of Commerce placed import of raw Agarbatti under “Restricted” category. This restriction revived 100s of Agarbatti units in the states of Madhya Pradesh, Maharashtra, Gujarat and Uttar Pradesh. The restriction also resulted in the increase of import of bamboo sticks from Rs 210 crores in 2018-19 to Rs 370 crores in 2019-20.

Bamboo

India produces 14.6 million tonnes of bamboo every year. Around 70,000 farmers are engaged in bamboo plantation. Thus, enhancing import duty will help to boost bamboo production and also help industries that are dependent on bamboo. The KVIC will also launch bamboo plantation drive to make India self-sufficient and meet growing demands of bamboo in 3 to 4 years.

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