Advocates push for National Timber Board to enhance domestic timber production and international sales
In an effort to boost local timber production and reduce dependence on imports, the Indian government is considering significant policy reforms. The proposed changes could potentially make India self-reliant in timber production, aligning with the government's sustainability and Atmanirbhar Bharat goals.
India currently accounts for about 40% of the teak wood processed domestically, making it the preferred building timber in the country. However, the nation holds one-fifth (22%) of the world's teak resources, indicating a vast potential for growth.
One of the key challenges in increasing timber production is the current 18% GST rate on timber, which is one of the highest in the construction sector. This high tax rate discourages builders and homeowners from choosing timber, pushing them towards cheaper but environmentally harmful alternatives like UPVC and WPC.
To incentivize large-scale timber plantations, public-private partnerships (PPP) and subsidised financing from NABARD could play a crucial role. States like Tamil Nadu, Karnataka, and Andhra Pradesh are potential areas for such initiatives.
Many farmers are willing to plant teak and other timber species, but they need technical guidance and financial support to do so. The government's support in this regard could enable India to meet its own timber demand within a few years and potentially start exporting premium-quality timber.
The creation of a National Timber Board in India, modelled after authorities for tobacco, textiles, and leather, is another proposed step. The Union Minister of State for Ministry of Agriculture and Farmers' Welfare, Kailash Choudhary, is the commissioner for this initiative. The National Timber Board would draft a national strategy for timber production, trade, and exports.
Reducing GST rates on timber to 5% could make it more affordable for construction and furniture, boosting demand for locally grown wood. This move could encourage rural employment and reduce dependence on timber imports.
India's imports of timber have increased since 2010, particularly in residential housing construction. In 2022, India accounted for 97% of global round wood imports and 26% of global sawn timber imports. The country is the largest importer of teak sawn timber, surpassed only by the Netherlands. With the right policy support, India could potentially meet its own demand and become self-reliant in timber production.
The rise in demand for teak has been met primarily by plantation teak from Africa and South America. However, India's oldest teak plantation, established in 1841, is located in Nilambur, Kerala. Madhya Pradesh and Maharashtra are the states with the largest area of native teak.
Rajasekhar Thadepalli, the president of All India Federation of Timber and Allied Industries, emphasises the need for these policy reforms. The article was published on September 19, 2025. As India moves towards a more sustainable and self-reliant future, the proposed changes in the timber industry could play a significant role.
