Golden Prospects Of Golden Fibre | 2017-03-03 | daily-sun.com

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Golden Prospects Of Golden Fibre

Rajib Kanti Roy

    3 March, 2017 12:00 AM printer

Golden Prospects Of Golden Fibre

Golden Prospects Of Golden Fibre

When different newspapers of our country make headlines like “Jute goods losing export market”, “State-run jute mills run out of steam” or “Jute sector in deep trouble”, we can understand the situation of our jute industry. But it was not always the case. Jute industry of this region dates back to the 14th century. Gradually jute appeared as the principal cash-crop for the cultivators of this country with 90% of the world’s total jute production before the partition. Every section of the trade was highly organised and resourceful and maximum of the stakeholders used to get their feedback. It was only the grower who did not always get his fair share of return from the price of jute. Surprisingly, all the jute mills were initiated in Calcutta and its surrounding areas. Not a single jute mill was established in the East Bengal before the partition of India in 1947. Establishing jute mills far away from the jute growing region caused incalculable cost for transportation and as a result the jute growers received low price. British took the major interests earned from jute in the UK and with the rest of the money the city of Calcutta’s fortune was built. After the partition a number of jute mills were founded in East Pakistan, but the situation did not change for the ordinary jute growers. Till the late 1960s, more than 80% jute of the world were produced in East Pakistan, but depriving the Bangalees, West Pakistani rulers used the money gained from jute export in developing the cities like Karachi, Lahore and Rawalpindi. Though everyone thought that finally we could use the hard-earned money from jute in our development works in the post-liberation war Bangladesh, but we couldn’t maximize the potentials of our jute industry owing to corruption, inefficiency, mismanagement and futile suggestions given by various international organisations like World Bank and IMF. Operational jute mills are now running at less than 50 percent capacity, 25 out of 97 jute spinning mills are already closed and 21 jute mills out of 35 that were privatised before are now closed. However, still our jute industry has enough opportunities. ‘National Jute Day’ will be observed on March 6. Ahead of the day, we will examine the present situation and prospects of Bangladesh’s jute industry.

 


Agro-climatic environment has made Bangladesh a natural home for producing the best quality jute in the world. Losing the previous top position, now we are the second highest exporter of raw jute globally. Bangladesh’s jute sector entered into a critical time particularly during 1990s, as jute started to face increasing competitive pressure from synthetic substitutes, with technological developments leading to replacement of natural raw materials. Lack of significant efforts and required investments towards product development and diversification and inability to undertake the technological transformation undermined jute’s prospects as a fibre. Failure to follow modern marketing procedures and international trade practices led to the decline of Bangladeshi jute as an important globally-traded commodity. All these had adverse impact on production, consumption and export performance of jute. Owing to environmental conditions, scarcity of land for cultivation, high input cost, profitability of high-yielding variety, and hybrid crops and an unfavourable jute-rice price ratio, jute at present tends to be cultivated in less productive land.
In the first seven months of 2016-17 fiscal year, export of jute goods and raw jute was US$ 490 million, of which jute goods fetched $412 million and raw jute $79.92 million. Bangladesh earned $919.58 million by shipment of raw jute and jute goods in FY 2015-16 against the target of $947 million. Export was $868.53 million in FY 2014-15, of which jute goods earned $757 million, while raw jute export was $111.53 million. Though export of jute goods is increasing, a significant quantity of export comprises traditional items like hessian, sacking, raw jute and jute yarn which add less value. High value added jute goods have huge potentials, as diversified jute products can add value 10 times more than the traditional one.

 


The demand for new types of diversified jute products like gardening products, shopping bags, geo-textile, pulp and paper, home textiles, household products, floor covering and non-woven textiles is very high at the consumers’ level in the international market due to fast changing consumer behaviour. The international community is willing to import eco-friendly products. All the European countries under EU will totally ban use of polythene and plastic materials by 2017 because of their adverse impact on environment. Many countries like the United States (US) and the United Arab Emirates (UAE) have already gone for replacement of plastic shopping bags by jute-made shopping bags. The demand for eco-friendly bags is also increasing in Australasia, Middle East, Asia and African countries. Global market size of jute-made shopping bags will be approximately 500 billion pieces which will require a huge quantity of jute. Considering the adverse impact of synthetics on environment, shopping bags will have tremendous demand. Bangladesh can grab this huge market by following a proper policy.


Unfortunately, Bangladesh has no proper preparation for tapping the international market as there is no adequate infrastructure. Machineries of jute mills in Bangladesh are 50 years old and most of the plants have no facilities of dyeing and lamination which are essential for producing diversified products. We need to modernise the jute sector and require some policy changes to export more value-added non-traditional products. According to the present policy of the government, all benefits are allowed for the direct exporters, but in practice maximum jute goods producers are deprived of cash subsidy. Jute mill owners are mostly producing semi-finished products while small DJPs and SMEs are producing decent amount of eye-catching products for international market but they are deprived of subsidy.

 


Product diversification is a must to increase export earnings from international market. According to a research conducted by the Jute Diversification Promotion Centre (JDPC), there are 133 diversified jute products and approximately 400 jute goods producers in Bangladesh who are mainly working in sub-contract basis. There is no specific statistics to know how much diversified jute products are being exported from Bangladesh because there is no specific harmonised system code for most of the jute goods. Jute goods producers make a wide array of products including shopping bags, hand bags, handicrafts, rags, conference bags, espadrilles, teapot cover, bed cover, fashion clothing and jewelries. Besides, viscose and charcoal from jute have opened a new window for our jute exporters. Bangladesh Jute Research Institute has made numerous new products from jute materials like tin, school bench and table lamp. To ensure deserved position in the global jute market, Bangladesh has to establish a technical institute for developing technical experts and professional designers with proper research and innovation facilities. The government should take an effective jute goods diversification policy including setting up several special industrial zones like the EPZs for diversifying local jute products to attract local and foreign investors.


Besides thinking about the international market, Bangladesh should concentrate on increasing the use of jute goods inside the country as well. Though the government has passed Mandatory Jute Packaging Act 2010, but there is hardly any implementation of that law in reality. Still polythene bags are dominating the grocery markets. And the instruction of packaging 11 products by using jute bags is ignored to a great extent.

 

Government organisations are trying to increase the use of jute goods, but these are never enough.


Well, a few private organisations and individuals are working for the betterment of overall jute sector. They are trying to develop a brand image of Bangladesh’s jute involving all the stakeholders under one umbrella. ‘Pater Lorai’ (Fight For Jute) is such an organisation that is simultaneously providing jute-related information and conducting awareness campaign. As a part of such initiative, they have arranged an artwork exhibition from March 3-5 at Bishwa Sahitya Kendra, which will remain open from 3pm to 8pm for all. Nasimul Ahsan, founder of Pater Lorai, said, “When we started to work, we found that there was no organization comprising all the stakeholders together. In ‘Pater Lorai’, we included 3000 persons, who represent jute cultivators, raw jute buyers, jute processors, jute workers, jute good producers and jute goods consumers. Our aim was to create a single online platform (fightforjute.org) from where all the stakeholders can get all the necessary information related to jute. We formed a ‘Jute Goods Advisory Cell’ to assist the DJP and SME entrepreneurs. ‘Pater Lorai’ has been directing mass awareness programmes to increase the use of jute goods. We have 500 patbandhu (friend of jute), who have been contributing for the promotion of jute goods. Inefficient marketing policy and unexpected inclusion of middlemen have been restricting the jute growers from receiving deserved price and discouraging consumers from buying jute goods in a reasonable price. We are going to launch an online market place ‘UJute’, where both raw jute and jute products will be exhibited and sold. Jute and jute goods producers and consumers will meet each other on this site and they can establish contact.”


“We do believe that jute industry of Bangladesh has a great future ahead. If we can take proper policy, this sector can contribute a lot for achieving Sustainable Development Goals for our country,” Nasimul Ahsan added.


About 30 million people are directly or indirectly dependent on the jute sector as 3.5 million farmers are engaged in growing jute, 0.2 million people are working in jute factories, 0.1 million are engaged in jute trade, and a large number of people provide other related services. If Bangladesh government can take appropriate steps and attract local and foreign investors, jute industry can earn foreign currency and at the same time generate huge employment opportunities.  


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