AP Paper Mills all set to double capacity by 2006

Company gets Rs 650-cr loan from IFC & ICICI Bank

Rajahmundry-based Andhra Pradesh Paper Mills Limited (APP-ML), which has embarked on an ambitious modernisation-cum-expansion plan with an outlay of Rs 650 crore, will be nearly doubling its operational and production capacity by 2006.

The International Finance Corporation (IFC), Washington, and ICICI Bank have extended the Rs 650-crore loan to APPML.

"The process of increasing our operational and production capacity has already commenced and we will be completing the expansion programme by 2006," G Kanna Rao, deputy general manager, APPML, told Business Standard.

"The foundation work is already in progress, and the installation of machinery with upgraded technology will be done in the last six months before 2006," he added.

"At present, 300 tonnes of pulp a day is being produced at the Rajahmundry mill. The production capacity will be increased to 550 tonnes a day. While the Rajahmundry mill produces pulp, our Coastal Paper Mill at Madhavarayudupalem near Rajahmundry produces the paper by converting the pulp into paper," he said.

The expansion programme of APPML includes upgradation of the technology, doubling the production of pulp from the present 1.1 lakh tonnes to 2.1 lakh tonnes annually, replacement of the old machinery with new energy efficient and state-of-the-art technology and ensuring a pollution-free environment.

Dubbed as the Mill Development Plan (MDP), APPML will, as a result, phase out the earlier system of producing two types of paper "" quality paper and production of newsprint and straw, and will produce only fine quality paper.

The Mill Development Plan will also ensure reduction in water usage of 150 cubic metres of water to 100 cubic metres per tonne production of pulp.

The pollution levels will also come down to less than the permitted AOX (adsorbable organic halogens) levels of 2 kg per tonne. As part of the modernisation programme, old boilers and digestions are also being replaced with new ones including the continuous digestive system, which will be the largest in Asia.

The Andhra Pradesh Paper Mills is the fourth largest integrated pulp and paper manufacturer in India with a wood-based paper mill at Rajahmundry and another recycled and agro-based Coastal Paper Mill at Madhavarayudupalem, 20 km from Rajahmundry.

The paper mill is also exporting its paper products to Australia, Bangladesh, Sri Lanka and Malaysia. APPML earned for the country a foreign exchange worth Rs 2,185.77 crore last fiscal. APPML exports close to 12,000 tonnes of paper annually.

The company, which came into being in 1921 and started production in 1924 with 3,000 tonnes of paper, is currently producing 96,800 tonnes of paper a year.