Jute in jeopardy: Farmers getting no buyers despite bumper harvest

Bumper harvest of raw jute coupled with India’s reluctance to import, is going to desecrate the farmers of Bangladesh once again when the government’s policy support is yet to be articulated.

The jute mills of the West Bengal recently cancelled import orders of as much as 2.5 lakh bales (1 bale=5 mounds) of raw jute from Bangladesh due to their prolonged labour strike and production suspension.

The country is carrying over at least 15 lakh bale of raw jute to which, some 60 lakh bale is likely to be added this year, according to the government’s harvest projection.

The huge amount of raw jute will be a burden, and cause further jeopardy, if the government and private jute mills do not go for production and purchase of raw jute.

In the backdrop of surplus supply of raw jute and the lower demand from jute mills, farmers will not be able to recover their production cost. The resultant fall in the price of raw jute will cause economic sufferings to the jute cultivators.

Currently, some 22 jute mills are in operation under the state-run Bangladesh Jute Mills Corporation (BJMC) while the private operators are running 77 jute units and 150 jute-spinning mills in the country. Except for the spinning units, most of the jute mills, especially those under the BJMC, are in bad shape.

The private sector mill owners are not showing their interest to run their mills. Those who bought these mills are not interested to run the mills, rather they are selling the property of the mills, sources concerned said.

Suggested by experts and stakeholders to revive the sector, the Jute Ministry this year sought Tk 300 crore budget allocation to purchase raw jute, spares, fuel and other materials for production.

But the money was not allocated due to an absence of a concerted policy to revive the sector, Finance Ministry sources said. Moreover, a tussle is continuing between the concerned ministries of the government over the Jute Ministry demand, it is learnt.

However, the caretaker government has taken a fresh move to formulate a new jute policy for the revival of the ailing sector targeting enhancement of jute production capacity, diversification of product base, ways to attract foreign investment and increase of export earnings.

A high-profile government meeting recently assigned a committee, headed by Director General of the Department of Jute, to prepare a draft Jute Policy within one-month.

Jute is a neglected sector despite having almost 100 percent local value addition and the farmers fall victims to unstable government policy as they do not get good prices for their produce years after years and are forced to shift to other rewarding crops.

Crisis in the jute mills and in the whole jute sector exacerbated as the immediate past government failed to provide funds to the mills for jute purchase during the last harvesting season.

To make the crisis even worse, the workers of state-owned jute mills are not receiving their wages for the last 9 months and have been passing their days along with their family members through untold sufferings and economic hardship.

Shahidullah Chowdhury, a veteran trade union leader and leftist politician who passed 60 years of his life serving the jute sector, said that 30 per cent loss of the jute sector was caused by power shortage and another 30 per cent due to interest charges. Jute sector itself is responsible only for another 30 per cent of the losses.

He alleged that the successive governments were following the suggestions of the World Bank and the International Monetary Fund (IMF) causing a crippling effect in the jute sector.

Shahidulla Chowdhury said, “If the jute industries are saved from the state of ruination, those may contribute significantly to the country's fragile economy as well as rescuing huge number of workers from miserable economic hardship.” Being viable, Bangladesh can export 3 lakh tons and earn Tk 1200 crore foreign currency each year from the jute sector only, he added.