Bangladesh Government Plans to Re-Open Jute Mills

Dhaka, Bangladesh, July 20--Seeing a surge in the demand for jute products in international markets, the Bangladesh government is planning to revamp the sector, once a major foreign currency earner, by reopening all the closed mills. The government is planning to operate all 22 state-owned mills this year to meet the requirement of jute products such as sacks and carpet backing cloth put forward by Syria, Ghana, Australia, Japan and some EU countries. Only seven such mills are currently operating on a partial basis due to short supply of raw jute. The Prime Minister's Office has taken special interest in rejuvenating the sector after noticing a sudden spurt in demand for these natural fibre-made products, which are considered to be environment and human health friendly, sources close to PM Office, said. "I am not able to meet the entire requirements of foreign buyers even if I operate all 22 jute mills," said ASM Solaiman Chowdhury, chairman of Bangladesh Jute Mills Corporation (BJMC). The officials are projecting five million bales of jute production this year, which is 1.6 million bales higher than that of last year. The country expects higher jute production this year due to favourable weather. Sensing the increased use of jute and fibre products in the international market, China has already shown interest in investing in Bangladesh to manufacture new textile, blending jute with cotton. A Chinese team has already met Jute and Textile Minister Shahjahan Siraj and discussed a joint venture projects. "It's very possible that jute would once again turn into Golden Fibre of Bangladesh, if we take certain actions," Shahjahan Siraj said. The Jute and Textile Ministry wrote last month to the Ministry of Finance for a minimum fund of Tk 1.0-Tk 1.5 billion, to procure jute fibre for BJMC mills. "I have got only Tk 300 million so far, much below than what I really need," Siraj said. The farmers are currently selling jute at Tk 800 to Tk 900 per maund (37.50 Kgs approximately), which is double last year's price. However, the price would fall as full jute harvesting season sets in next month. "We are planning to offer Tk 500 to Tk 600 for a maund this year, which will be Tk 100 more than last year's price," the BJMC chairman said. The government is planning to open 105 jute purchase centres across Bangladesh. Bangladesh exports jute and jute products worth Tk 15 billion a year amid recurring losses incurred by those mills. Shahjahan Siraj said the mills' cumulative overdue loans and unsettled workers' claims would total Tk 40 billion, which could be met only by reopening the jute mills and earning profit through increased export. Analysts said corruption, excessive employment and use of synthetic fibre had made jute mills losing concerns. "We are ready to finance the mills if they prove to be viable," said Zakir Ahmed Khan, the secretary of Ministry of Finance. Farmers now grow jute on 425,000 hectares of land, which is less than half of the area they used to cultivate four decades ago. Angry farmers burnt their own produce protesting the low price of jute a few years ago. Bangladesh that once accounted for 70 per cent of the global export of jute and jute products.

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