Jute sector warrants urgent bailout measures  

Published: January 26, 2019 22:06:18 | Updated: January 28, 2019 22:08:18

Few people can remain unconcerned at the news of the decline in the export earnings of the country's jute and jute products. This is what has happened in the first half of the current fiscal year, 2018-19. The news is potently disconcerting. According to a recent FE report, the earnings from jute declined by 26 per cent in July-December of 2018 compared with the corresponding period in the previous fiscal year (FY). People directly involved in the sector have ascribed the falling demand of jute and jute products to global trade adversities. According to the latest data coming from the Export Promotion Bureau, Bangladesh exported jute and jute goods worth $421 million in July-December of the ongoing FY. The figure was $574 million in the first half of the last fiscal year. Against the backdrop of the steady rise in the global demand for the Bangladeshi jute and jute products, with the farmers and the people in the jute sector looking to better days, few were prepared to experience this damper. That this export shrinkage will have negative impacts on the country's resurgent jute sector needs no in-depth analysis.

The declining trend in the earnings from export of jute and jute products is feared to cause jitters in the sector. Jute was once the backbone of the nation's economy. The fabled golden fibre used to engage large numbers of farmers in its cultivation in the vast jute producing regions. This agro-segment was accompanied by the countrywide mills and factories manufacturing jute yarn and gunny sacks. After an agonisingly long pause in its production following the invasion of polythene products, jute had lately started re-emerging. The sector in Bangladesh experienced a new lease of life. Upon whetting expectations of the farmers and entrepreneurs involved in the jute farming and jute goods sector, the crop was attached a great priority --- both nationally and globally. Thanks to its biodegradable nature, jute in no time found a premier place in the search for an alternative to plastic, polypropylene etc.

In a generalised observation, a 'European economic slowdown' has been blamed on the latest plunge in export earnings from jute. Jute goods exporters point the finger at the cut in the import of the Bangladeshi jute yarn by a few countries which make carpets targeting Saudi Arabia, USA and other Western countries. The carpet importing countries have apparently lowered the volume of imports due to the 'economic slowdown'. Jute sector insiders also cite the anti-dumping duty imposed by India on a number of Bangladeshi jute products since 2017 for the disruption caused to the country's jute export earnings. With troubling developments in the background, the jute sector warrants urgent bailout measures. The job could be made easier by giving a final shape to the long-awaited draft jute policy. Such a policy can play a critical role in formally integrating the jute sector with the national economy.

Share if you like