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Project Profile of Paper Mill and Packaging Paper Industry in Bangladesh

    Bangladesh’s growing economy is fueling massive demand for paper and packaging materials. From textbooks to tissue boxes, paper touches almost every industry. Therefore, establishing a Paper Mill and Packaging Paper Industry in Bangladesh is not only a profitable venture but also a socially impactful one.


    Importance of Paper and Packaging Industry in Bangladesh

    The paper and packaging industry is vital because it directly supports education, communication, FMCG, pharmaceuticals, e-commerce, and logistics. Most important, it helps reduce dependency on imports by producing high-quality packaging locally.

    Bangladesh currently consumes more than 1.2 million metric tons of paper per year. With population growth, industrial expansion, and e-commerce boom, this demand is expected to double by 2030.

    Besides that, the country’s improved literacy rate, export-driven manufacturing, and eco-friendly shift toward biodegradable packaging materials are creating fresh opportunities for investors.


    Market Overview

    Because of increasing industrialization, the packaging paper segment is now the fastest-growing area within the paper industry. Food, garments, and pharmaceuticals rely heavily on corrugated cartons, kraft paper, and duplex boards for packaging and export purposes.

    According to Bangladesh Paper Mills Association, around 70+ large and medium paper mills are now operating, but most focus on writing and printing paper. Therefore, the packaging segment still holds a huge untapped potential.


    Project Summary

    Project ComponentDetails
    Project NamePaper Mill and Packaging Paper Industry
    LocationGazipur / Narayanganj / Bogura / Khulna Industrial Zone
    Land Area3–5 Acres
    Production Capacity60 MT per day (Kraft & Duplex Board)
    Raw MaterialWaste Paper, Pulp, Chemical Additives
    Product TypesKraft Paper, Duplex Board, Test Liner, Fluting Paper
    Power Requirement500 kW (with backup generator)
    Water Requirement200 m³/day
    Employment120–150 persons
    Project Duration18–24 months (implementation phase)

    Raw Materials and Sources

    The major raw materials include waste paper, pulp, starch, and various chemical agents for whitening, sizing, and coating.

    Raw MaterialSourceUnit Cost (BDT)Consumption (MT/day)Total Cost/day (BDT)
    Waste Paper (Imported / Local)Local Collection + Import45,000502,250,000
    Pulp (Supplementary)Import95,0005475,000
    Starch, Alum, AdditivesLocal Supplier65,0002130,000
    Packaging MaterialsLocal50,000
    Total Daily Raw Material Cost2,905,000

    Therefore, the total monthly raw material cost stands around BDT 8.7 crore assuming 30 operational days.


    Machinery and Equipment List

    The machinery is the heart of any paper mill. Modern automated systems help improve quality, reduce waste, and optimize energy.

    Machinery NameOriginEstimated Cost (BDT)
    Waste Paper Pulping SystemChina / Italy3,50,00,000
    Pulp Cleaning and Screening UnitChina1,20,00,000
    Paper Making Machine (3.6m Width, 60TPD)China / India8,50,00,000
    Press and Drying SectionChina2,00,00,000
    Calendering and Rewinding UnitChina1,00,00,000
    Coating and Cutting LineChina / Taiwan1,50,00,000
    Boiler (6 ton) and Steam PipelineIndia1,00,00,000
    Power Distribution & Control PanelLocal80,00,000
    ETP (Effluent Treatment Plant)Local70,00,000
    Laboratory EquipmentLocal20,00,000
    Miscellaneous ToolsLocal30,00,000
    Total Machinery CostBDT 21.70 Crore

    Building and Civil Construction Cost

    The infrastructure cost depends on plant layout, storage, and utility design.

    ItemDescriptionArea (sq.ft)Rate (BDT/sq.ft)Total (BDT)
    Factory Shed (Steel Structure)Main Production Hall50,0001,6008,00,00,000
    Administrative BuildingOffice, QC, Canteen10,0002,0002,00,00,000
    Raw Material & Finished Goods GodownStorage20,0001,2002,40,00,000
    ETP and Boiler HouseUtilities5,0001,50075,00,000
    Roads, Boundary, DrainageCivil Works1,00,00,000
    Total Civil WorksBDT 14.15 Crore

    Total Project Cost Estimate

    ParticularsEstimated Cost (BDT)
    Land & Land Development4,00,00,000
    Civil Construction14,15,00,000
    Machinery & Equipment21,70,00,000
    Installation & Erection2,00,00,000
    Utility Setup & Power Connection1,00,00,000
    Vehicles & Logistics1,00,00,000
    Office Equipment & Furniture50,00,000
    Pre-Operational Expenses75,00,000
    Working Capital (3 months)10,00,00,000
    Total Project CostBDT 55.10 Crore (Approx.)

    Working Capital Requirement

    Working capital ensures smooth operations—covering raw materials, wages, utility bills, and transportation.

    Working Capital ItemMonthly Cost (BDT)3-Month Reserve (BDT)
    Raw Materials8,70,00,00026,10,00,000
    Salaries & Wages60,00,0001,80,00,000
    Utilities & Fuel35,00,0001,05,00,000
    Maintenance & Repairs20,00,00060,00,000
    Marketing & Distribution25,00,00075,00,000
    Administrative Overheads20,00,00060,00,000
    Total Working Capital30.9 Crore (approx.)

    Revenue Projection

    YearProduction (MT/year)Selling Price (BDT/MT)Revenue (BDT Crore)Profit (BDT Crore)
    Year 114,00095,000133.015.0
    Year 218,00097,000174.622.5
    Year 320,000100,000200.028.0
    Year 422,000103,000226.632.5
    Year 524,000105,000252.037.0

    Break-even Period: 3.5 years (estimated)


    Profitability and Return

    The project ensures stable returns due to continuous demand. Most important, packaging paper faces no seasonal fluctuation.

    IndicatorValue
    Internal Rate of Return (IRR)22–25%
    Payback Period3.5–4 years
    Net Profit Margin14–18%
    Gross Margin25–30%
    ROI (5 Years Average)20%

    Manpower and Organizational Setup

    DesignationNumber of StaffMonthly Salary (BDT)Total Cost (BDT)
    General Manager1150,000150,000
    Production Manager2100,000200,000
    Engineers / Technicians860,000480,000
    Machine Operators3030,000900,000
    Helpers / Laborers6020,0001,200,000
    Accounts / Admin Staff1035,000350,000
    Security & Maintenance825,000200,000
    Total Monthly Salary3,480,000 BDT

    Environmental and Safety Considerations

    Because paper production involves chemical processes, a proper Effluent Treatment Plant (ETP) is mandatory. It ensures waste water is treated before release.

    Recycling waste paper helps reduce environmental damage and supports sustainability goals. The use of energy-efficient motors and steam recovery systems further reduces carbon footprint.


    Competitive Advantage

    1. Raw Material Availability: Local waste paper collection networks reduce cost.
    2. Low Labor Cost: Bangladesh offers competitive labor rates.
    3. Growing Market Demand: Driven by FMCG, garments, and logistics.
    4. Export Potential: Opportunity to export kraft paper to Nepal, Bhutan, and India.
    5. Government Incentives: Tax holidays, duty-free machinery import, and green financing schemes.

    Risk Factors and Mitigation

    Risk FactorImpactMitigation Strategy
    Raw Material Price FluctuationHighLong-term supplier contracts
    Power InterruptionMediumBackup generator / captive power plant
    Water Pollution RiskHighInstall modern ETP system
    Competition from ImportsMediumFocus on quality & delivery
    Machinery DowntimeMediumRegular maintenance & spares stock

    Project Implementation Schedule

    ActivityDuration
    Feasibility Study & Land Acquisition3 months
    Project Design & Loan Sanction3 months
    Civil Construction6 months
    Machinery Procurement & Shipment5 months
    Installation & Commissioning4 months
    Trial Production & Marketing3 months
    Total Implementation Period24 Months (Approx.)

    Financing Plan

    Source of FundAmount (BDT Crore)Percentage
    Sponsor’s Equity22.040%
    Bank Loan33.060%
    Total Project Cost55.0100%

    Interest subsidy or green financing under the Bangladesh Bank’s refinance scheme may reduce loan interest to 6–7% per annum.


    Future Expansion Possibilities

    Once the plant stabilizes, additional product lines such as coated duplex board, tissue, or corrugated carton units can be integrated. Besides that, automation in packaging and labeling can increase efficiency.


    Socio-Economic Impact

    This project will create employment for over 150 people and generate local business opportunities for transporters, waste paper collectors, and chemical suppliers. Furthermore, it will reduce import dependency and save foreign currency.

    By converting waste into usable products, it directly supports the national goal of a Circular Economy and Green Bangladesh Vision 2041.


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