Two state jute mills leased to private sector

The government yesterday handed over two jute mills to the private sector as part of its efforts to modernise the state-run enterprises dealing with the natural fibre.

It comes 18 months after the Bangladesh Jute Mills Corporation (BJMC) shut 25 state-run jute mills to put an end to the heavy losses they had been incurring for years.

Yesterday, Karnafuli Jute Mills Ltd in Chattogram was leased out to Unitex Group, and Bangladesh Jute Mills Ltd in Narsingdi to Bay Group. The lease period is 20 years.

"We hope that they will start operations within one and a half months," said Md Abdur Rauf, secretary of the textiles and jute ministry.

In July 2020, the government decided to shut down the production at 25 state-run jute mills under the BJMC providing 100 per cent dues to 25,000 workers.

Later, the corporation sought interest from investors as the government looks to lease out 17 mills.

The BJMC received 55 proposals from investors from home and abroad. Of them, 14 proposals met the criteria.

Five investors were selected for five mills. And Rauf is optimistic to hand over three mills by February.

A survey was conducted at the jute mills to find out the condition of the machinery.

The secretary said the private sector does not want to waste time and the investors are proactive to start operations. "We will seek bids for 12 jute mills by this month."

Md Nasimul Islam, general manager of the BJMC, said Jute Alliance Ltd, a concern of Bay Group, paid Tk 9.60 crore in advance rents and Unitex Group paid Tk 5.28 crore for 24 months. The bills and other expenditures would be borne by the investors as well.

The BJMC will act as a monitoring body to oversee whether investors comply with the terms and conditions. The investors can upgrade the machinery after taking consent from the corporation, he said.

Mohammad Arif, chief financial officer of Unitex Group, says it looks to start commercial operation within a month and has already appointed the necessary workforce.

Unitex will produce jute products for local and international markets at the mills.