The Kerala State Cabinet has approved a ₹741 crore expansion project for Kerala Paper Products Limited (KPPL), marking a significant move to strengthen the public sector under the LDF government. The initiative will focus on enhancing production capacity and broadening the range of paper products manufactured at the company’s Velloor facility.
KPPL was established in 2019 after the Kerala government took over the Velloor unit of Hindustan Newsprint Limited, which had been shut down by the Union government. The closure had left thousands of workers and their families facing uncertainty. Following the takeover, the State government restructured the operations, resumed production, and stabilised the unit.
Industries Minister P Rajeev stated that this marks the first instance in the country where a State government has revived a closed Central Public Sector Undertaking (CPSU), restored operations, and moved ahead with a major expansion programme. Under the approved plan, the Kerala government will invest ₹175 crore as equity, while Kerala State Industrial Development Corporation (KSIDC) will provide ₹25 crore in equity support. The remaining ₹541 crore will be mobilised through a consortium of banks.
According to the minister, the paper sector is witnessing strong growth potential nationwide. Increasing environmental regulations, including restrictions on plastic usage, coupled with evolving consumer preferences, have boosted demand for sustainable paper products. The rapid growth of e-commerce, food delivery services, and organised retail has further accelerated demand for packaging-grade paper. Additionally, the requirement for writing and printing paper, copier paper, notebooks, and textbooks continues to rise steadily across India.
Despite strong domestic demand in Kerala for specialty grades, packaging grades, and writing and printing paper, the State currently relies heavily on supplies from other regions, incurring substantial freight costs. The expansion project aims to bridge this gap by developing a paper manufacturing cluster and strengthening local production capabilities. Upon completion of the expansion and full commissioning of the new facilities, KPPL is projected to achieve an annual turnover of ₹1,500 crore. The project is expected to be completed within 24 months.
The minister added that reviving an enterprise of the scale and technical capability of Hindustan Newsprint Limited once India’s largest newsprint manufacturer after it remained closed for more than three and a half years, and transforming it into a diversified and growing company, represents a landmark achievement in India’s industrial history.