The cabinet sub-committee had approved the Rs 20,000 cr investment by Sinar Mas in Raigad district for a paper manufacturing plant in the month of October. The first phase of 300 acres is located in Dherand (Raigad). The Indonesian paper major is setting up its first plant in India.

The state industries minister Uday Samant said “After giving approval to the project in the cabinet sub-committee, we have sent an offer letter for the first phase of investment to Sinar Mas. The company will invest Rs 10,500 crore in this phase. We have also given a land allotment letter to the firm for 300 hectares."  

Two decades ago, Ballarpur Industries (BILT) had acquired the stake in the erstwhile Sinar Mas Pulp & Paper India. This was bought by BILT Paper Holding, the flagship of the LM Thapar group, in a deal valued at Rs 520 crore. After the acquisition, BILT had integrated the manufacturing plant in Kurkumbh with BILT.  

The sale of APP's Indian unit, Sinar Mas India, was the first asset disposal in 2001 by the beleaguered pulp and paper giant, which had debts and obligations of USD13.4 billion and was working on a massive debt restructuring. At that time, the company had told creditors it will sell noncore assets in China and Indonesia.

Healthy demand, increased shipping and freight cost, ban on single use plastic, increased coal prices can be game changers for the Indian paper and packaging industry. An analysis of the top paper mills in India indicate that paper  capacity utilisation rate is very high. But with the tailwinds petering out, paper capacity is set to rise by the rate of 10% by FY24E. Most of the major players are putting up newer capacities.

Meanwhile an industry insider spoke to PrintWeek and said, "There is an interesting history to the Sinar Mas deal. Two decades ago, APP owned Sinar Mas India through another unit called Sinar Mas Mauritius. BILT was the holding company of Indian paper firm Ballarpur Industries. Gautam Thapar and his flagship company, Ballarpur Industries (now known as BILT) loaded on debt between 2007 and 2014.

BILT made an acquisition of Sabah Forest Industries, Malaysia's largest pulp and paper mill, for USD261 million in 2006. However, it failed to scale up its Malaysia operations, as the cost of importing from that plant to India became higher than buying it locally. This made the acquisition unviable." In 2019, Gautam Thapar was arrested for money-laundering charges. In 2015, Thapar had already sold his entire shareholding in Crompton Greaves Consumer."