Cabinet Approves Extension of Norms for Mandatory Packaging of Foodgrains and Sugar in Jute Materials

The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi has accorded its approval for mandatory packaging of foodgrains and sugar in jute material for the Jute Year 2019-20 on 27 November 2019.

The Government has retained the scope of mandatory packaging norms under the Jute Packaging Material (JPM) Act, 1987 as per last year. The decision of the Cabinet mandates that 100% of the food grains and 20% of the sugar shall be mandatorily packed in diversified jute bags.

Benefits

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% 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.

Background

Nearly 3.7 lakh workers and several lakh farm families are dependent for their livelihood on the jute sectors. The government has been making concerted efforts for the development of jute sector; increasing the quality and productivity of raw jute, diversification of jute sector and also boosting and sustaining demand for jute products.

The jute industry is predominantly dependent on Government sector which purchases jute bags of value of more than Rs. 7,500 crore every year for packing foodgrains. This is done in order to sustain the core demand for the jute sector and to support the livelihood of the workers and farmers dependent on the sector.

Other Support provided to the Jute Sector

In order to improve the productivity and quality of raw jute through a carefully designed intervention, called the Jute ICARE, the Government has been supporting approximately two lakh jute farmers by disseminating improved agronomic practices such as line sowing using seed drills, weed management by using wheel-hoeing and nail-weeders, distribution of quality certified seeds and also providing microbial assisted retting. These interventions have resulted in enhancing the quality and productivity of raw jute and increasing income of jute farmers by Rs. 10,000 per hectare.

In this connection, to support jute farmers, a grant of subsidy of Rs. 100 crore for two years starting from 2018-19 has been approved to enable JCI to conduct MSP operations and ensure price stabilization in the jute sector.

With a view to support diversification of jute sector, the National Jute Board has collaborated with National Institute of Design and a Jute Design Cell has been opened at Gandhinagar. Further, promotion of Jute Geo Textiles and Agro-Textiles has been taken up with the State Governments particularly those in the North Eastern region and also with departments such as Ministry of Road Transport and Ministry of Water Resources.

With a view to boost demand in the jute sector, Government of India has imposed Definitive Anti-Dumping Duty on import of jute goods from Bangladesh and Nepal with effect from 5th January, 2017.

With a view to promoting transparency in jute sector, Jute SMART, an e-govt initiative was launched in December, 2016, providing an integrated platform for procurement of B-Twill sacking by Government agencies. Further, the JCI is transferring 100% funds to jute farmers online for jute procurement under MSP and commercial operations.