Jute Industry

MAY 5

Mains   > Economic Development   >   Indian Economy and issues   >   Manufacturing sector

IN NEWS:

  • The ongoing crisis of the jute industry in West Bengal has led to the closure of several jute mills.

WHAT ARE THE ONGOING ISSUES?

  • Mills are procuring raw jute at prices higher than what they are selling them at after processing.
    • Mills do not acquire directly from the farmers because the farmers are far-off from the mills locations and the procurement process is cumbersome.
    • The procurement now flows through middlemen or traders.
    • The middlemen charge mills for their services, which involves procuring jute from farmers, grading, bailing and then bringing the bales to the mills.
    • Thus the existing mechanism of procurement through middlemen or traders results in the procurement of raw jute at higher prices.
    • Though the Union government has come up with several schemes to prevent de-hoarding, the mill owners believe the mechanism requires a certain “systematic regulation”.
    • The government has a fixed Minimum Support Price (MSP) for raw jute procurement from farmers, which is Rs 4,750 per quintal for the 2022-23 season.
    • However, as per the mill owners, the raw jute reached the mill at Rs 7,200 per quintal, that is, Rs 700 more than the Rs 6,500 per quintal cap for the final product.
    • The Centre’s refusal to increase the cap to Rs 7,200 as demanded by the jute mills, has pushed the industry into unprecedented crisis.
  • Cyclone Amphan and the resultant disruption in supply:
    • The occurrence of Cyclone Amphan in May 2020 and the subsequent rains in major jute producing states led to lower acreage, which in turn led to lower production and yield compared to previous years.
    • Additionally, as the Commission for Agricultural Costs and Prices (CACP) stated in its report, Cyclone Amphan and related events led to production of a lower quality of jute fibre in 2020-21 as water-logging in large fields resulted in farmers harvesting the crop prematurely.

BASIC DETAILS ABOUT JUTE FIBER:

  • Jute is a natural fiber with golden and silky shine and hence called The Golden Fiber.
  • Jute fiber is 100% bio-degradable and recyclable and thus environmentally friendly.
  • Jute is the cheapest vegetable fiber procured from the bast or skin of the plant’s stem.
  •  It is the second most important vegetable fiber after cotton, in terms of usage, global consumption, production, and availability.
  • The best varieties of Jute are Bangla Tosha – Corchorus olitorius (Golden shine) and Bangla White – Corchorus capsularis (Whitish Shine).
  • The best source of Jute in the world is the Bengal Delta Plain, which is occupied by Bangladesh and India.
  • Conditions of Growth:
    • Jute is the crop of hot and humid climate.
    • It requires high temperature varying from 24°C to 35°C and heavy rainfall of 120 to 150 cm with 80 to 90 per cent relative humidity during the period of its growth.
    • Small amount of pre-monsoon rainfall is very useful because it helps in the proper growth of the plant till the arrival of the proper monsoon.
    • Incessant and untimely rainfalls as well as prolonged droughts are detrimental to this crop.
    • Large quantity of water is required not only for growing the jute crop but also for processing the fibre after the crop is harvested.
    • Light sandy or clayey loams are considered to be best suited soils for jute.
    • Since jute rapidly exhausts the fertility of soil, it is necessary that the soil is replenished annually by the silt-laden flood water of the rivers.

APPLICATIONS OF JUTE FIBER:

  • Jute is used for making yarn, twine, rope, sacking, cloth, hessian cloth, carpet backing cloth (CBC), carpet, mat, wall cloth, shopping bag and as packing materials.
  • Jute is used chiefly to make cloth for wrapping bales of raw cotton, and to make sacks and coarse cloth.
  • The fibers are also woven into curtains, chair coverings, carpets, area rugs, hessian cloth, and backing for linoleum.
  • While jute is being replaced by synthetic materials in many of these uses, some uses take advantage of jute’s biodegradable nature, where synthetics would be unsuitable.
  • Traditionally jute was used in traditional textile machineries as textile fibers having cellulose (vegetable fiber content) and lignin (wood fiber content).
  • But, the major breakthrough came when the automobile, pulp and paper, and the furniture and bedding industries started to use jute and its allied fibers with their non-woven and composite technology to manufacture nonwovens, technical textiles, and composites.
  • Diversified jute products are becoming more and more valuable to the consumer today. Among these are espadrilles, floor coverings, home textiles, high performance technical textiles, Geotextiles, composites, and more.
  • Thus, jute is the most environment-friendly fiber starting from the seed to expired fiber, as the expired fibers can be recycled more than once.

JUTE TEXTILE INDUSTRY IN INDIA:

  • History and evolution:
    • Jute textile industry is the second important textile industry of India after cotton textile industry.
    • This industry existed in Bengal as handloom industry but the large-scale industry started in 1855 at Rishra, near Kolkata.
    • In 1859, the first powerlooms were started in the same mill and the spinning as well as weaving was undertaken.
    • This industry suffered a great setback as a result of partition of the country in 1947 because 81 per cent of the jute output went to Bangladesh (erstwhile East Pakistan) while 102 out of 112 jute mills remained in India.
    • Consequently, acute shortage of raw jute was felt in India as the import of raw material from East Pakistan was cut off due to the political differences between the two countries.
    • A consistent effort to increase the area under jute cultivation was able to correct the situation later.
    • It is traditionally in an export-oriented industry and its survival largely depends upon its export performance. The rise and fall of the industry is closely linked with the demand for goods in the international and national markets.
  • Distribution
    • Jute textile industry is mainly concentrated in eastern India because of the rich alluvial soil of Ganga-Brahmaputra delta grows about 90 percent of India’s jute and provides raw material to jute mills.
    • Major jute producing states include West Bengal, Bihar, Odisha, Assam, Andhra Pradesh, Meghalaya and Tripura.

  • Present status of jute industry in India:
    • As per the Food and Agriculture Organisation (FAO), India is the largest producer of jute followed by Bangladesh and China.
    • However, in terms of acreage and trade, Bangladesh takes the lead accounting for three-fourth of the global jute exports in comparison to India’s 7%.
    • Following are the reasons why India lags behind Bangladesh
      • India lags behind Bangladesh in producing superior quality jute fibre due to infrastructural constraints related to retting, farm mechanisation, lack of availability of certified seeds and varieties suitable for the country’s agro-climate.
      • What also does not bode well for India is that jute acreage competes with crops as paddy, maize, groundnut, and sesame.
      • The increased availability of synthetic substitutes causes a drop in the demand for jute domestically.
    • 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.

 

PROBLEMS OF INDIAN JUTE INDUSTRY:

  • Impacts of Partition:
    • Most of the jute-producing areas went to Bangladesh (erstwhile East Pakistan) resulting in acute shortage of raw jute.
      • Although successful efforts have been made to increase the supply of raw jute since Independence, it still falls short of our current requirements.
  • 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.
  • Obsolete technology 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 machines for more than a century, productive capacity has gradually declined.
    • The labour requirements in these machines are very high and this large labour force is increasing the cost of production.
  • Competition from synthetic materials
    • Jute industry has to face a very tough competition from synthetic packing materials of the advanced countries of Europe and North America. As such the market for jute goods has shrunk.
    • The overall demand for jute products is gradually decreasing in the international market.
  • Competition from Bangladesh:
    • The newly established mills and improved machines in Bangladesh are able to produce better quality goods and have an edge over the Indian jute products in the international markets.

INITIATIVES BY THE GOVERNMENT

  • Jute Packaging Materials (Compulsory Use in Packing Commodities) Act, 1987:
    • Under the Jute Packaging Materials (Compulsory Use in Packing Commodities) [JPM Act], 1987, Government specifies the commodities and the extent to which they are mandatorily required to be packed in Jute Packaging Materials.
    • At present, a minimum of 100% of food grains and a minimum of 20% of sugar are to be compulsorily packed in jute sacking.
    • On an average, the annual Government support to jute industry on this account amounts to Rs.7500 crores.   
  • Inclusion of jute products under Technical Textiles items:
    • Directorate General of foreign Trade (DGFT) has issued a Notification dated 15th January, 2019 incorporating 207 items as Technical Textiles out of which 15 items are related with jute.
  • Minimum Support Price (MSP) for Raw Jute and Mesta :
    •  Minimum Support Price for raw jute and mesta is fixed every year to protect the interest of farmers.
    • While fixing prices of different grades, the issue of discouraging production of lower grade jute and encouraging production of higher grades jute are taken into consideration so as to motivate farmers to produce higher grade jute.
  • Incentive Scheme for Acquisition of Select Machinery:
    •  To increase the productivity of the jute machinery and make them efficient by replacing the old machines by new and technologically advanced machines, National Jute Board (NJB) has been implementing schemes for modernization of jute industry.
    • During the Jute Technology Mission (JTM) (2007-2013), a scheme known as ‘Acquisition of Plant and Machinery’ (APM) (Capital subsidy) was instrumental in bringing in investment of more than Rs. 500 crore.
    • Considering success of the JTM scheme, the Incentive Scheme for Acquisition of Plant and Machinery was launched in 2013.
  • Jute - Improved Cultivation and Retting Exercises (ICARE):
    • The objective of the scheme is to support the small and marginal jute growers with adequate pre and post harvesting operations so that they can grow good quality jute & receive higher price for their produce.
    • The scheme Jute I-Care will also make the growers aware about the latest technologies in the country.
  • Usage of Jute Geo-Textiles (JGT) in NER States:
    • Jute geotextiles being technical textiles is an eco-compatible solution to crucial geotechnical problems such as Soil erosion, Consolidation of Soft Soil, Construction of Rural Roads and for agro-textile applications.
    • Continuous interactive awareness programmes have been organized with the Engineers and other stakeholders in various states including North East for increasing uses of jute geotextiles.
    • The progress in application of jute geotextiles includes, 118 rural roads (approx. 900 K.Ms) under PMGSY, 36 flood embankments in West Bengal, 9 roads in UP (43 K.Ms) under constructions, 2 river embankments in Bihar under constructions, 1 road in Tamil Nadu (2.8 K.Ms) under PMGSY and Indian Railway used about 46 lakhs sq.mtrs. of jute geotextiles Has strengthening embankment.
  • Apart from this, the National Jute Board (NJB) has been implementing several measures for the benefit of workers, artisans and small producers and for promotion of the jute industry. These include:
    • Export Market Development Assistance Scheme to facilitate registered manufacturer exporters of jute products to participate in international fairs and take business delegations abroad for export promotion of lifestyle and other diversified jute products.
    • Jute Integrated Development Scheme (JIDS) aims at setting up local units and agencies at distant locations around the country through collaboration with bona-fide bodies to carry out various activities. JID agencies are prime sources for market facilitation to the Jute Diversified Products (JDP) units, SHGs, WSHGs, NGOs.
    • Jute Raw Material Bank (JRMB) Scheme aims at accelerating the pace of Jute Diversified Products (JDP) activities in the country by catering to the jute unorganised sector and the production units so that jute raw material is supplied to them regularly at economic rates.
    •  Retail Outlet of Jute Diversified Products Scheme for providing assistance to jute entrepreneurs for opening of outlets of jute lifestyle jute products in Metro Cities, State capitals, District Head Offices and Tourist spots.
    • Design Development Scheme - NJB Jute Design Cell at NID for development of Jute Shopping Bags and Lifestyle Accessories has also been set up at the Innovative Centre for Natural Fibres (ICNF) of NID (National Institute of Design), Ahmedabad whose prime objective is to develop newer and innovative Products through design and technology intervention for value addition and better market at home and abroad.
    • Focused Market Initiatives for organising and participation in Jute Fairs, National Fairs / Regional Fairs, Export oriented fairs in India & abroad to extend marketing support to the artisans, small and micro entrepreneurs:
    • Skill Development Program: Various Skill Development programmes are conducted for providing training on manufacture of jute diversified products to correctional homes like inmates of Tihar Jail, New Delhi, families/beneficiaries of the Delhi Police, Border Security Force (BSF) and other institutions.
    • Subsidy Scheme for Distribution of Certified Seeds:- This is a scheme for distributing certified jute seeds to the farmers. Certified jute seeds are being distributed at a subsidy of Rs. 40/kg under the scheme.

WAY FORWARD

  • Government should further promote the diversification of jute products.
    • For example, lifestyle products and accessories, technical textiles, jute geotextiles etc.
    • Should utilize the important properties of jute fibre since it has huge diversifying potentiality.
    • Advantages of jute include good insulating and antistatic properties, as well as having low thermal conductivity and moderate moisture regain.
    • Along with cotton, jute should be utilized for apparel manufacturing.
  • Jute industry should effectively utilize the opportunity that arises due to increase in environmental awareness at national and international level. For example. Decision to ban of single use plastic in India.
  • Government must make efforts in R&D to strengthen the jute industry and implement newer technologies, and improved machinery through intensive modernization.
  • Jute production is a labour intensive industry, so it can be effectively utilized to reduce unemployment and poverty in India.

PRACTICE QUESTION:

Q. Discuss the challenges and prospects associated with jute textile industry in India with special reference to various initiatives taken by the government to support the sector.