The Central Government is on the verge of closing its purchase of jute bags for its rabi foodgrain packaging by this March. As a consequence, local jute producers will be compelled to check their total production, keeping in mind the aggregate demand from the market.
However, the chances are more towards reduced number of working shifts, fewer working days in a week and frequent closures. Waning demand from private industry users and commodity sector can be largely accused for this changing trend.
The jute industry in India heavily depends on large scale departmental buying of jute bags during the rabi season and for the packaging of imported wheat as well. On the contrary, export of jute products have nearly stagnated between 2-3 lakh tons valued at Rs1,000-1,200 crore.
Bangladesh being a rival country is currently facing a terrible setback in its jute industry. Under the circumstances, India could have made the most of the opportunity to boost its own jute sector. However, owing to shipments of substandard jute products and global shift to cheaper poly packs, local producers failed to meet their targets.
Besides, frequent labor unrest, unreliable supply line and strict quality control from the recipient countries are some other factors affecting export performance of the jute industry.
Experts are of the opinion that the supplying jute mills could have performed better if there were adequate rail wagons for trouble-free transportation and timely dispatches to destinations.
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