A new lease of life for jute
A new era for the Bangladesh jute industry will begin as the government is finalising a packaging law that will boost local consumption of the green fibre and cushion growers and millers from falls in global demand.
The law already has a green light from cabinet and is being vetted at the law ministry. It is likely to be placed in parliament soon, a top official of the textiles and jute ministry said yesterday.
The act, after passage, will make jute packaging of essential commodities, such as rice, wheat and sugar, fertilisers, cement and seeds, compulsory for public and private organisations engaged in production, import and distribution.
This will enhance local demand for jute and give farmers and millers a buffer against a fall in demand abroad, where about 90 percent of Bangladesh jute is now sold.
We expect to place the bill in parliament soon. We are trying to see the bill pass as early as possible, said Md Ashraful Moqbul, secretary of the textiles and jute ministry.
The government move to frame the law comes a year after the industry, an employer of nearly 150,000 workers, suffered a nearly 20 percent slump in export earnings in fiscal 2008-09 due to a fall in prices.
Exports, however, were on the rebound in 2009-10, spurred by a rise in the price of the natural fibre on the world market. Exports soared 76 percent to $736 million in fiscal 2009-10, from $417 million the year before.
Moqbul said an increase in the use of jute for packaging would cut demand for polythene bag based packaging, which harms the environment.
According to the official, an advisory committee will suggest the percentage of jute sacks to be used for mandatory packaging, on the basis of annual jute production.
The draft law will allow a fine of up to Tk 50,000 and three-month imprisonment for violations.
At present, Moqbul said, only the food and disaster-management ministry and the Bangladesh Agricultural Development Corporation buy jute sacks.
After enactment of the law, public sector bodies such as Bangladesh Chemical Industries Corporation and Bangladesh Sugar and Food Industries Corporation will have to use jute for packaging, he added.
In addition, private sector entities will also have to use jute for packaging, officials said.
The initiative comes more than two decades after India enacted a similar rule to encourage domestic consumption. India uses jute in bulk for internal consumption.
It is going to open a new chapter for the jute industry, said Najmul Huq, chairman of Bangladesh Jute Mills Association, a body of private sector jute mills.
Now we are hostage to importers. But enactment of the law will be an indication that we have our own market, he said. BJMA has been lobbying for many years.
The law is expected to be in force at a time of surging raw jute production; nearly 60 lakh bales this year, up from 49.7 lakh bales a year ago.
Moqbul said the mandatory packaging law would shield jute growers and millers.
Md Shamsul Haque, marketing director of the state-run Bangladesh Jute Mills Corporation, said the law would benefit jute farmers as well as his ministry.
It will encourage increased cultivation due to a rise in demand."
At present, about 40 lakh people are involved in the cultivation of jute, the second most important fibre after cotton.
A new lease of life for jute
