Kolkata, The Commission for Agricultural Costs and Prices has recommended that Jute Corporation of India should take proactive steps to extend its reach for spot procurement of raw jute directly from farmers, which will help discover a competitive price, millers said on Sunday.
The recommendation came at a time when the industry is grappling with a raw jute crisis.
A jute millers’ association has claimed that the market price was hovering at Rs 7,000-7,200 a quintal as against the textile ministry’s decision to put a ceiling on raw jute price at Rs 6,500 per quintal for mills, leading to the raw material shortage.
The ministry had said that the move was taken to stop hoarding of the commodity.
“CACP in its 2022-23 report on price policy for jute has made recommendations to JCI to involve registered cooperative societies, farmer producer organisations, self-help groups, farmers’ clubs, and also employ mobile purchase teams, if required, for greater procurement of raw jute from cultivators directly,” a source in the jute industry told PTI
CACP also acknowledged that the majority of jute growers are small and marginal, and often forced to sell their produce to middlemen, he said.
“JCI operation is meagre. The current problem of raw jute will reduce significantly if the government’s direct Minimum Support Price procurement is intensified at village levels. In absence of its operations, traders and hoarders remain active and control raw jute prices, leading to a financial loss to mills and the government,” said a former chairman of Indian Jute Mills’ Association on condition of anonymity.
Although JCI initiated its operations when prices were below MSP, limited presence in remote areas and constraints of storage capacity often led to distress sales in local markets, CACP noted in its recommendation.
The commission also proposed close monitoring of supplies from Bangladesh and corrective measures, including review of import duty structure and imposition of a countervailing duty to restrict subsidised imports of jute and its products from the neighbouring country.
It also recommended that Indian firms should take advantage of export incentives available under Remission of Duties and Taxes on Exported Products (RoDTEP) to promote shipments overseas.
During 2020-21, Bangladesh provided cash subsidies on yarn, twine, hessian, sacking, carpet backing clothing (CBC), and other diversified products of jute.
Such a subsidy policy of the neighbouring country affected the competitiveness of Indian jute goods and its share in the international market. PTI