Development and Promotion of Jute Industry | 19 Feb 2024

Source: SANSAD

Why in News?

Recently, the Standing Committee on Labour, Textiles and Skill Development has presented the Fifty-Third Report on ‘Development and Promotion of Jute Industry’.

What are the Key Highlights of the Report?

• Potential of Jute Industry:
  • The Jute industry occupies an important place in the national economy of India. It is one of the major industries in the eastern region, particularly in West Bengal.
  • Jute, the ‘golden fibre’, meets all the standards for ‘safe’ packaging in view of being a natural, renewable, biodegradable and eco-friendly product.
• India as Major Share of Jute Production in the World:
  • India is a major player in global jute production, contributing 70% of the world’s jute output.
  • The Jute industry directly employs approximately 3.7 lakh workers, with around 90% of the production consumed domestically.
    • About 73% of jute industries are concentrated in West Bengal (out of 108 composite jute mills 79 are in West Bengal).
• Production and Export Data (2022-23):
  • In the fiscal year 2022-23, the production of jute goods reached a significant milestone, totalling 1,246,500 metric tons (MT).
  • Exports of jute goods surged to 177,270 MT, constituting approximately 14% of the total production. This represents a remarkable 56% increase in exports compared to figures recorded in 2019-20.
    • The rise in exports can be attributed to several factors, including increased demand for environmentally friendly and sustainable products worldwide.
  • India imported 121.26 thousand MT of raw jute during the same period.
    • The importation primarily stems from the preference for high-quality jute from Bangladesh, which is utilised in the manufacturing of value-added products.
  • The top export markets for jute goods include a diverse array of countries such as the USA, France, Ghana, the UK, the Netherlands, Germany, Belgium, Côte d’Ivoire, Australia, and Spain.
• Major Challenges Faced by Jute Industry:
  • High Rate of Procurement: Mills face a high rate of procurement, acquiring raw jute at prices exceeding their selling prices post-processing.
    • This is exacerbated by a convoluted procurement process involving middlemen or traders, increasing costs further.
  • Insufficient Raw Material: Despite efforts to boost jute cultivation, India still struggles with insufficient raw material supply, exacerbating procurement issues and affecting production capacity.
  • Obsolete Mills and Machinery: The Jute Industry grapples with obsolete mills and machinery, necessitating technological upgrades to enhance efficiency and competitiveness.
  • Fierce Competition From Synthetic Materials: Jute contends with fierce competition from synthetic materials, which offer cheaper packaging solutions, impacting demand for jute products negatively.
    • Furthermore, decreased demand is witnessed due to the availability of alternative fibres like Mesta, diminishing the market for jute products.
  • Labour issues and Infrastructure Hurdles: Labor issues plague the industry, particularly in West Bengal, with frequent strikes, lockouts, and disputes disrupting operations and adding to instability.
    • Infrastructural bottlenecks such as inadequate power supply, transportation challenges, and limited access to capital impede the industry's sustainability efforts, hindering growth and modernization initiatives.

What are the Key Recommendations of the Standing Committee?

• Modernising and Upgrading Technology:
  • There is a need to encourage jute mills to invest in state-of-the-art machinery and technology to enhance productivity and elevate product standards.
  • Foster partnerships with research institutions to drive innovation and progress.
• Efficient Raw Material Procurement:
  • Streamline the process of acquiring raw jute to minimise expenses. Promote contract farming initiatives and offer incentives to farmers to boost jute cultivation.
• Enhanced Quality Control and Standardisation:
  • Reinforce quality control protocols to maintain uniform excellence in jute products. Establish and enforce stringent standards for jute goods.
• Skill Enhancement and Training:
  • Empower jute workers with comprehensive training programs to refine their expertise.
  • Place emphasis on honing skills in weaving, dyeing, and value-added processes.
• Market Expansion:
  • There is a need to pioneer exploration into untapped global markets for jute products.
  • Promote jute-based handicrafts and lifestyle commodities to broaden market reach.
• Research and Development Promotion:
  • Allocate resources for research endeavours focused on advancing jute-related innovations.
  • Encourage collaborative efforts between industry players and research entities.
• Promoting Jute Products:
  • Launch awareness campaigns spotlighting the eco-friendly attributes and sustainability of jute.
  • Educate consumers on the merits of choosing jute products.
• Policy Advocacy:
  • Formulate policies that incentivize jute cultivation and value addition.
  • Extend financial assistance to jute mills for the adoption of cutting-edge technologies.

What are the Government Schemes Related to Jute Industry?

• Export Market Development Assistance (EMDA) Scheme:
  • The EMDA program, initiated by the National Jute Board (NJB), encourages manufacturers and exporters of jute products to participate in international fairs worldwide. It aims to promote the export of lifestyle and other Jute Diversified Products (JDPs).
• Jute Packaging Materials (Compulsory Use in Packing Commodities) Act 1987:
  • The act was enacted to ensure the mandatory use of jute packaging material in the supply and distribution of certain commodities.
    • The Cabinet Committee on Economic Affairs has extended mandatory packaging of 100% food grains and 20% sugar in diversified jute bags for the Jute Year 2023-24.
• Jute Geotextiles (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.
• Minimum Support Price for Jute:
  • Jute Corporation of India (JCI) is the Price Support Agency of the Govt. of India for jute, to protect the interest of the Jute Growers through procurement of Raw Jute under the MSP fixed by the government from time to time and also to stabilise the raw jute market for the benefit of the jute farmers and the jute economy as a whole.
• Golden Fibre Revolution and Technology Mission on Jute and Mesta:
  • They are two of the government initiatives to boost jute production in India.
  • Due to its high cost, it is losing the market to synthetic fibres and packing materials, particularly nylon.
• Jute SMART:
  • It is an 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.