Nepa mills: waiting to live life again! Can the government revive the Nepa Mills and the old vibrant city and expedite its Rehabilitation process on fast track


Nepa mills: Waiting to live life again! Can the government revive the Nepa Mills and the old vibrant city and expedite its Rehabilitation process on fast track

It was in the year 1977 that I took admission in Nepanagar Higher Secondary school after taking transfer from Nehru Montessori school Burhanpur in class 8th. It was like the movie “Purab aur Pashcim’ an old classic by Manoj kumar. Very soon I started liking the ‘Desi’ environment of the Nepa school with teachers speaking in ‘Thet’ native ‘Hindi’ language as against the imposed english and western culture of Nehru Montessori school. I also felt comfortable with Maths and science subjects and started understanding the concepts for the first time rather than mugging them up as was the practice in Montessori English medium convent school.

Nepanagar Higher secondary school was among the best school in the district if not the state or may be it was. Its name and fame spread in all directions like the fragrance of a decent flower.The school management, Principal ( Sh Pathak ji and then Mishra ji) were the hallmark of wisdom and activism.Luminaries from the state and beyond used to visit the school and kept inspiring the young ignited minds.This continued when I passed in 1980 and further until one unfortunate day things started falling apart.

The fortunes of the school was directly linked with Nepa Mills which used to bear all the expenses of the school and was responsible for its management. Today the city is beleaguered and almost deserted. Nepa mills the heart and sole benefactor of the city is looking for saviours. Despite the central and state governments things are not moving as expected due to delays from various sides including the corona 19 pandemic which has also taken its toll. We request the central and state government to expedite and streamline the processes so that the Mill and hence the city can breathe with fresh air.

As a student who owes a lot to Nepanagar Higher Secondary school, I feel it like my duty to write this blog and request all stakeholders to reinvigorate what once was an Ideal town with vibrant cultural , education and other activities. All the ministries involved, like the Ministry of Heavy Industries, Ministry of environment and Forest Climate Change and Ministry of Finance have been helping for the cause but there is a need to fast track has to take an active role in making the destiny of Nepa mills on fast track. The city still has the old charm of a rustic tranquil timberland situated on the banks of river Tapti and is surrounded by verdant forest and woods with distant Asir fort and near by hills which is a perfect place for any literature buff to read, write, paint, brood etc. Once again this town can attain its old glory with a fresh dose of proactive participation by one and all.

History and Background

The area surrounding Nepanagar, a small town with a population that was centered around the Mills, was full of Salai woods and bamboo that was the main ingredient for the production of paper that was manufactured by the mills. NEPA pioneered manufacturing of newsprint in the country. It commenced production from April, 1956 with an installed capacity of 30,000 TPA.The mill embarked upon major expansion programmes in 1967 and subsequently in 1978 and 1989 to increase its installed capacity to 88,000 TPA. Presently, the Company has switched to Waste paper as basic raw material from original forest based and has thus been able to reduce cost of production

Originally floated by a private entrepreneur in 1947. Management was taken over by the Madhya Pradesh Government in 1949 and became a Central Government Company in 1959. First indigenous newsprint manufacturing unit in the country. Originally NEPA was a single product Company producing standard Newsprint. The Company has produced for the first time in India, 42 GSM newsprint meeting practically all international parameters of strength, opacity, surface smoothness, brightness etc. Thus, NEPA is now able to meet the demand across all categories of Newsprint customers.

Present status :

On disconnection of power supply by MPEB (Madhya Pradesh Electricity Board) in 1996 and due to acute shortage of forest based raw material, the mill switched over to recycling of recovered paper since 1997, without adding the DIP (De-inking plant) necessary for processing recovered paper having ink due to which the company continuously ran into losses.

Company was referred to BIFR in 1998. However, the revival plan of the company was approved by GoI in September 2012 only. BIFR sanctioned the revival scheme of the company in March 2014. The Revival Plan envisaged capital investment of Rs.285 crores for installing a new 300 TPD De-inking Plant, Refurbishment of both Paper Machines, Renovation of 12.27 MW Captive Power Plant and renovation of existing 132 kv Substation. Govt sanction, BIFR approval and environmental clearance took almost 6 years after cost estimation as a part of original TEFR in 2010.The project cost which was approved at Rs. 285 crore has got escalated to Rs. 434 crore (net of EPCG benefits). This increase was mainly on account of delays, growth of work and as per actual price discovery based on open tendering.

Therefore, a plea for an additional budget of Rs.149 crores on account of cost escalation and Rs.128 Cr in lieu of loan from financial institutions was submitted through the Cabinet Note to GoI in December, 2017. The cabinet Note was sanctioned by the GoI on 3rd October, 2018 with a total support package of Rs. 469.41 Cr. that include Rs. 277 Cr towards revised cost of RMDP, Rs, 101.58 [ 16 ] Cr. towards salary support and statutory dues and Rs. 90.83 Cr. towards Voluntary retirement of 400 employees. In order to monitor the RMDP work, DHI has constituted a high Level RMDP monitoring committee headed by AS&FS from DHI.

A technical Committee comprising members from Central Paper & Pulp Research Institute (CPPRI), Saharanpur, M/s BHEL, Bhopal and M/s Bridge & Roofs (B&R), Kolkatta has been constituted to regularly visit and monitor the project progress on site and report to the Govt. As per current estimates the RMDP is expected to complete by early 2021. On completion of the RMDP, company will be able to manufacture 100000 TPA of Newsprint of higher brightness and also the Writing & Printing Paper and expects to become self sustaining.

As per the Draft Rehabilitation Scheme (DRS) for revival of the company Government of India has released fresh equity infusion of Rs. 157 Crore in four instalments i.e. Rs. 8.10 Crore on 27.03.2014, Rs. 50.00 Crore on 26.12.2014, Rs. 50.99 Crore on 23.10.2015 and Rs. 47.91 Crore on 31.03.2016. Non–plan loan of Rs. 38.26 Crores towards salaries and wages was received from Government of India in March 2020. A revised RMDP package amounting to Rs. 469.41 crore has been sanctioned by GOI/CCEA on 3 October, 2018. As per budgetary support to Nepa Ltd for Revival Mill Development Plan the Government of India, Ministry of Heavy Industries & Public Enterprises, Department of Heavy Industry, vide [ 93 ] there letter No. 7(12)/2014–PE–VII dated 12th October 2018 have directed for infusion of additional equity of Rs. 277 crores for revised cost estimates of Revival Mill Development Plan.Accordingly, Government of India vide letter no. vide letter No. 7(12)/2014–PEVII dated 18.12.2018. have released a sum of Rs. 33 Crores for part implementation of RMDP in Nepa Ltd.

Dr. Asheesh Shah


Asheesh Shah
Author: Asheesh Shah

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