The crisis in the Jute Industry

The crisis in the Jute Industry

News: Member of Parliament (MP) from Barrackpore constituency in West Bengal met the Union Textile about issues concerning jute farmers, workers and the overall jute industry.

Issues:
• High rate of procurement by Mills. Mills are procuring raw jute at higher prices than what they are selling them after processing. Mills do not acquire their raw material directly from the farmers because farmers are far off from the mills locations and procurement process is cumbersome.
• The situation particularly has become worrisome recently with the occurrence of Cyclone Amphan in May 2020 and the subsequent rains in major jute producing States. These events led to lower acreage, which in turn led to lower production and yield compared to previous years. Also, this led to production of a lower quality of jute fibre in 2020-21 as water-logging in large fields resulted in farmers harvesting the crop prematurely.
• Instances of hoarding impact the final price. For example, the government has a fixed Minimum Support Price (MSP) for raw jute procurement from farmers, which is Rs. 4,750 per quintal for the 2022-23 season. However, this reaches the mill at Rs. 7200 per quintal. The jute sector provides direct employment to 3.70 lakh workers in the country and supports the livelihood of around 40 lakh farm families, closure of the mills is a direct blow to workers and indirectly, to the farmers whose production is used in the mills. West Bengal, Bihar and Assam account for almost 99% of India’s total production.

Facts to know about Jute from Prelims perspective:
• Temperature – Between 25 – 35 Degree Celsius
• Rainfall – 150-200 cm
• Soil – Well drained alluvial
• It is also known as Golden Fibre
• India is the largest producer of jute followed by Bangladesh and China. However, in terms of acreage and trade, Bangladesh takes the lead accounting for three-fourth of the global jute exports in comparson to India’s 7%.

Government initiatives:
• Jute Packaging Materials Act, 1987 – The act provides for the compulsory use of jute packaging material in the supply and distribution of certain commodities in the interests of production of raw jute and jute packaging material. .
• Jute Geo-Textiles (JGT) - The Cabinet Committee on Economic Affairs (CCEA) has approved a Technical Textiles Mission which includes Jute Geo-Textiles. JGT is one of the most important diversified jute products. It can be applied in many fields like civil engineering, soil erosion control, road pavement construction and protection of river banks.
• Jute Smart – E-government initiative which was launched in December 2016 to promote transparency in the jute sector. It provides an integrated platform for procurement of sacking by government agencies.