Cabinet approves extension of jute packaging norms for foodgrains and sugar

The Cabinet has approved extension of norms for mandatory packaging of foodgrains and sugar in jute material for the Jute Year 2019-20.

The decision taken by the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, mandates that 100 per cent of the foodgrains and 20 per cent of sugar will be mandatorily packed in diversified jute bags.

“The decision to pack sugar in diversified jute bags will give an impetus to the diversification of the jute industry. Further, the decision also mandates that initially 10 per cent of the indents of jute bags for packing foodgrains would be placed through reverse auction on the GeM portal. This will gradually usher in a regime of price discovery.

“The approval will benefit farmers and workers located in the Eastern and North Eastern regions of the country particularly in the states of West Bengal, Bihar, Odisha, Assam, Andhra Pradesh, Meghalaya and Tripura,” an official statement said.

As stress on artificial fibres as a packaging material in preference to natural ones is growing, the prospects for jute, popularly known as the Golden Fibre, are opening up further. Bangladesh so far has hardly been able to make the most of this possibility. Jute procurement during the harvest season could save up to 28 percent of production costs (in nominal terms), compared to the post-harvest season.

Productivity of the jute mills could be increased by about 10 per cent with proper production balancing, proper maintenance practice and scheduled overhauling of the old machinery. To this end, it will be necessary to reinvigorate the sector with generous budgetary allocations. At the same time, the ailing state-owned jute mills have to be reinvigorated and new jute mills set up and where feasible replace the old production technologies with new ones. The government needs to facilitate them with necessary policy support.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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