The jute sector is a significant contributor to India’s economy, providing direct employment to nearly 3.70 lakh workers and supporting around 40 lakh farming families. However, it currently faces a crisis with the closure of several jute mills, particularly in West Bengal due to various issues.
The Procurement Challenge
One significant problem is that mills are procuring raw jute at prices exceeding the selling price after processing. The extensive procurement process involves middlemen who acquire jute from farmers, grade it, bale it, and then deliver these bales to mills, charging for their services. Furthermore, the geographical distance between farmers and mills hampers direct procurement. The current season’s Minimum Support Price (MSP) for raw jute procurement stands at Rs. 4,750 per quintal, but it reaches the mill costing Rs. 7,200 per quintal, causing a financial burden.
Impact of Weather Conditions
Cyclone Amphan, which hit in May 2020, associated with subsequent heavy rains, severely impacted jute production. Lower acreage resulted in diminished production and yield compared to previous years. Water-logging in large fields forced farmers to harvest prematurely, leading to the production of low-quality jute fibre.
Government Initiatives for the Jute Sector
Recognizing the potential of India’s Jute industry, the government has initiated numerous programmes. The Golden Fibre Revolution and Technology Mission on Jute and Mesta aim at boosting jute production in India. The Jute Packaging Materials Act, 1987, was established to protect the interests of approximately 4 lakh workers and about 40 lakh farming families by making the use of jute packaging material obligatory. Jute Geo-Textiles (JGT) was approved by the Cabinet Committee on Economic Affairs (CCEA) to be used in numerous fields. Furthermore, the Jute SMART initiative was launched in December 2016 to promote transparency in the jute sector.
India’s Prominence in Jute Production
India is the largest producer of jute, closely followed by Bangladesh and China. The country accounts for only 7% of global jute exports, compared to Bangladesh’s 75%. Jute production is concentrated in eastern India due to the availability of rich alluvial soil in the Ganga-Brahmaputra delta. Major jute producing states include West Bengal, Bihar, Odisha, Assam, Andhra Pradesh, Meghalaya, and Tripura. Jute, often referred to as the golden fibre, has multiple uses, including making gunny bags, mats, ropes, yarn, carpets, and other artifacts.
Despite these challenges, the potential for India’s jute industry remains untapped. With adequate government support and targeted interventions to address the procurement and weather-related concerns, the future of India’s jute industry looks promising.
