The New Nation - Internet Edition

THE jute and textile ministry at last reached the conclusion that unless the mills were relieved of loan burden and made self-sustaining in their operations, they would automatically die within a short span of time. Already the number of state-run jute mills in operation has come down to 14 now from 77 in 1972 when they all were nationalised and placed under a corporation. The ministry concerned is set to seek a bailout for the debt-ridden jute mills through budgetary measures and has raised recently the issue of debt relief with the central bank and nationalised commercial banks.

Assumption of certain amount of loans through the budgetary process, writing off portions of the loan amounts, injection of fresh funds or sale of some property like land of the state-owned jute mills might be considered in the bailout package as reported by media. The jute mills under the Bangladesh Jute Mills Corporation (BJMC) now owe four banks more than Tk 4,000 crore a major portion of which is said to be interest arrears. The interim government late last month assigned a task force headed by the jute and textiles secretary to suggest ways and means to invigorate the jute sector keeping the jute mills out of its purview. The task force is to look after the promotion of the private sector jute industry.

The 14 public sector jute mills that are now in operation, are ignored in the process. Seven of the eight other state-owned jute mills that remained closed are now in the process of handover to private entrepreneurs. The jute ministry earlier backtracked on a plan to constitute a national commission for mapping out 'an effective jute sector revival strategy'. All post-1980 governments pursued an almost identical policy of squeezing the jute industry on the excuse of chronic losses.