India’s jute economy is faltering while Bangladesh’s is flourishing? Suggest measures to be taken to enhance jute industry in India ?

India’s Jute Industry

• India is the world’s biggest producer of jute, followed by Bangladesh. Jute is primarily grown in West Bengal, Odisha, Assam, Meghalaya, Tripura and Andhra Pradesh.
• The jute industry in India is 150 years old. There are about 79 jute mills in the country, of which about 60 are in West Bengal along both the banks of river Hooghly.
• Jute production is a labour intensive industry. It employs about two lakh workers in the West Bengal alone and 4 lakh workers across the country.

The major problems of Indian Jute Industries are mentioned below:

• High cost of production: Equipments for production are all worn out, outmoded in design. Many mills are uneconomic. Products are made costlier.
• Storage of raw Jute: Jute industry suffers from inadequate supply of raw jute.
• Shortage of Power Supply: Load-shedding creates problem of under-utilization of capacity.
• Growth of Jute mills in Bangladesh and loss of foreign market: Newly started jute industry in Bangladesh has captured some of the market of Indian jute goods.
• Emergence of substitute goods against gunny bags and loss of demand for jute goods both at home and abroad: Indian jute goods have been losing ground in the world market primarily due to keen competition from synthetic substitutes and also supplies from Bangladesh and China.
• Effects of Partition: Due to Partition in 1947, the erstwhile best quality jute-producing areas went to the then East Pakistan (now Bangladesh) while the jute mills were mainly concentrated in the Indian Territory. Bangladesh received 82% of the good quality jute growing tract India retained 95% of the mills. The resultant acute shortage of raw jute forced some of the mills to close down.
• Stiff Competition: Bangladesh, Sri Lanka, Thailand and China are recently posing grave threat to India in international export market.
• Low Yield Per Acre: India produces very low quantity of jute per unit of land. In Bangladesh the average yield per hectare is 1.62 tonnes. It is only 1.3 tonnes per hectare in India. The corresponding figure of jute production in China is 1.78 tonnes per hectare. In Taiwan, it is 2 tonnes per hectare.
• Outmoded Mills and Machinery: Most of these jute mills were established some 100 or 150 years back. Naturally most of these mills are having backdated machinery. Output of these machines is very low compared to the modern sophisticated machines. Because of use of these for more than a century, productive capacity has gradually declined.
• Low Demand: Not many people are aware of plastic alternatives like jute. Besides, the misconception that cotton bags are more durable, presentable and nature friendly has resulted in very few people using jute products.
• Pandemic: The coronavirus pandemic has also thwarted hopes of restoring the lost glory of the industry — several mills have shut down and lockdowns have caused labour and raw material shortages.

• Mandatory use of Jute goods: Mandatory use of Jute bags in food grains and sugar, cement and in fertilizers.
• Modernization and Rationalization: Modernization and rationalization of Jute mills have been undertaken.
• Nationalization of ‘sick’ Jute mills: The National Jute Manufac­ture Corporation Limited (NJMC) under the Ministry of Textiles has taken over the management of sick Jute mills.
• Under the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act 1987 (JPMA), the government is required to consider and provide for the compulsory use of jute packaging materials for supply. Under unusual circumstances, the central government can allow the use of plastic bags as an alternative for up to 30% of the total requirement for food grains.
• Whenever the market price of raw jute falls below a certain level, the Jute Corporation of India (JCI) procures raw jute at Minimum Support Price (MSP), fixed on the basis of recommendation of the commission for Agricultural Cost and Prices (CACP), from jute growers to safeguard their interest.
• Incentive Scheme for Acquisition of Plants and Machinery (ISAPM): Government of India launched ISAPM for Jute Industry and Jute Diversified Products Manufacturing Units in 2013. The basic aim of this scheme is to facilitate modernization in existing and new jute mills and up- gradation of technology in existing jute mills and to provide assistance to a large number of entrepreneurs to manufacture value added biodegradable Jute Diversified Products (JDP) as well as for modernization Jute up-gradation of technology.