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Indian incense can be divided into two categories: masala and charcoal.
Masala incense is made by blending several solid scented ingredients into a paste and then rolling that paste onto a bamboo core stick. These incenses usually contain little or no liquid scents (which can evaporate or diminish over time).
Charcoal incenses are made by dipping an unscented "blank" (non-perfume stick) into a mixture of perfumes and/or essential oils. These blanks usually contain a binding resin that holds the sticks' ingredients together. Most charcoal incenses are black in colour.
(extract from wikipedia)
Masala incense is a higher quality incense and thus more expensive.