Home Bangladesh Karnaphuli Paper Mill completely closed
Bangladesh - Corporate - District - December 25, 2022

Karnaphuli Paper Mill completely closed

No buyer for 3,000 tons of paper

— Mill closed for lack of pulp
— Salaries going on with loans
— Initiatives to set up new plant

Mahfuja Mukul: Karnaphuli Paper Mill (KPM) is a nearly 70-year-old traditional paper manufacturing plant. This once popular factory is now completely closed due to lack of equipment, institutional indecision, pulp crisis etc. The last bit of production from the old paper was last August. The News print factory is burdened with debt due to its age. In this, again there is a load of 3,000 tons of unsold paper. Even during the extreme paper shortage in the country, these papers suitable for printing textbooks are not being used. The company is trying to set up a new plant to turn around.
The mill authorities say that the old machinery is on the verge of becoming useless. Many machines have become useless. Hence initiative has been taken to set up new plant within the existing establishment of the mill. Feasibility study for setting up new plant is underway. The feasibility study report is expected to be submitted by this December.
Karnaphuli Paper Mill Managing Director Engineer Swapan Kumar Sarkar told, “Our plant is very old. Moreover, there is a shortage of pulp. Pulp has not been available from domestic sources for several years. It has also become difficult to import from abroad. Recently, the price of pulp in the international market has increased a lot. That is why the plant is now closed.
Talking to KPM people, it is known that in 1953 Pakistan Industrial Development Organization established Karnaphuli Paper Mill Limited in Chandraghona of Kaptai Upazila of Rangamati district. The mill was initially set up with the cooperation of America, England, Germany, Sweden and Italy and loan assistance from the World Bank.
The annual production target of the factory was 30 thousand metric tons. Commercial production began on 16 October 1953. At that time almost 100% of the paper requirement of East and West Pakistan was supplied from Karnaphuli paper mill. Later, the government of Pakistan sold the mill to the Dawood Group in 1964 due to management complications. The company modernized the mill.
When Bangladesh became independent in 1971, Bangladesh Industrial Development Corporation acquired Karnaphuli Paper Mill. Even in 1990-91, Karnaphuli Paper Mill had an annual production capacity of 30,000 tons. The paper produced by Karnaphuli Paper Mill is also very popular in Bangladesh. However, KPM fell behind in the competition when the private paper mills were established in the country along with the import of paper from the past two years. The crisis was created in a large state-owned paper mill.
The chemical plant of Karnaphuli Paper Mill was closed in 2016.
It is known that the manda was made in KPM with bamboo and pulpwood (soft wood) collected from its own sources. Paper was made from that pulp. Karnaphuli Paper Mill is capable of producing writing paper, printing paper, corrugated board, wax coated paper, adhesive tape and bitumen paper.
The workers of the mill said that bamboo is produced locally in its own well area as the raw material of the mill. One ton of pulp is made from 4-5 tons of bamboo. Production of paper from bamboo used to cost Tk 18-20 thousand per ton. In 2017, KPM stopped producing paper using bamboo and pulpwood as raw materials extracted from its wells due to various problems. In this, their own chemical plant (CC plant) was also closed.
The production cost of paper increases manifold due to stop harvesting bamboo and pulpwood and use old paper and imported pulp.
Moreover, the suppliers failed to provide the supply even after tendering the work order for the supply of foreign pulp. KPM is not getting a new supplier due to the lack of funds even though a new tender has been called. In the last financial year (2021-22), three rounds of tenders were called for importing pulp, but no one participated in the tenders. As a result, the production of the factory stopped due to lack of pulp.
The workers said that many valuable machines are also becoming useless due to the closure of their pulp making plants.
It is known that there are currently more than 220 permanent workers and officials in Karnaphuli Paper Mill. There are about 350 temporary manpower. At present, the monthly expenses of the organization including the salaries of the officers-employees-labourers are about Tk 5 crore.
Karnaphuli Paper Mill CBA president Abdur Razzak said that the production of the factory has stopped due to the pulp crisis. Pulp crisis in the current international market. Due to which our factory is also in crisis. About three thousand tons of paper produced in the last two years remain unsold. At present, the salaries and allowances of the factory employees are being paid with loans from BCIC.
Initiative to establish a new factory
BCIC has taken initiative to set up a new factory in place of KPM factory. Meanwhile, KPM has signed a memorandum of understanding with M/s China National Machinery Import and Export Corporation (CMC), China. Besides, an organization is working to verify the technical and financial feasibility of setting up KPM and paper-based chemical plants.
The new factories include forestry with integrated paper mills, soda ash plants, sodium sulphate plants, basic chemical plants (caustic soda, chlorine, hydrogen peroxide, bleaching earth, titanium dioxide, hydrochloric acid, sulfuric acid, phosphoric acid etc.) and synthetic polyester fiber. There are plants.
Karnaphuli Paper Mill Managing Director Swapan Kumar Sarkar told, “The process of setting up a new plant at KPM has started. As KPM is a very old mill, we are giving priority to installing the new mill.
3,000 tons of unsold paper
KPM gradually turned into a loss-making company for more than two centuries. In order to avoid the crisis from the last few years, the government directed to buy all types of government paper from KPM.
The National Curriculum and Textbook Board (NCTB) procured all the papers for their books from KPM. Every year NCTB used to get 250 to 3000 tons of paper from Karnaphuli. KPM manufactures around 5,000 tons of paper without order to supply required paper to NCTB. NCTB orders 1000 tons of paper in 2020-21 financial year. Subsequently, NCTB stopped paper orders in two financial years. Due to which KPM is currently in trouble with about 3000 tons of paper.
General Manager (Production) of KPM, Engineer Moidul Islam told, “At present, the production in the factory is stopped due to lack of pulp. However, about three thousand tons of paper produced earlier still remain unsold.
A KPM official, who did not wish to be named, said the papers were specially prepared for NCTB. These papers are not used much in other institutions. That is why it is not easy to sell.

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