Jute could be next main driver of economy

Jute and jute goods hold potential to become the next key driver of the economy as the present ones -- garments and remittance -- have little scope to contribute more in the long run, said an economist yesterday.

“Bangladesh needs a new growth driver. In this case jute and jute goods can be the main driver soon,” said Hossain Zillur Rahman.

The government has been favouring the garments sector over the years and should similarly give policy support on adding value to jute and jute goods and make non-performing jute mills profitable by keeping them running, he said.

People worldwide are avoiding harmful polythene in their daily lives while entrepreneurs in the country are investing on jute and jute goods to regain its lost glory, said the former adviser to a caretaker government.

He was addressing a seminar on diversification of jute for developing the industry at the Dhaka Chamber of Commerce and Industry (DCCI) in the capital.

Thousands of jobs have been created by small and medium jute mills in Bogra and Jessore running with machinery of Adamjee Jute Mills, which has been shut down, said Rahman.

Mirza Azam, state minister for textiles and jute, said jute production increased gradually from 65 lakh bales in 2014 to 70 lakh bales last year for better prices ensured by a government rule making its use mandatory in goods packaging.

More than 100 crore sacks were additionally produced for the rule and local entrepreneurs expanded the export base increasing the types of jute goods from 135 last year to 240 this year, he said. The government gave out a 20 percent subsidy on diversification, said the state minister.

“I am very much hopeful that the finance ministry will publish a circular within one week recognising jute goods as a product of the processed industry,” he said.

This will help exporters avail the incentive on exports like other agro-processed goods, he said. Azad said the government recognised jute goods as a product of the agro-processing sector two years ago, but the finance ministry has not given the recognition yet. As a result, exporters are not getting the incentives, he said.

The state minister called for producing skilled workforce as every year a lot of foreign currency is spent to hire foreign experts to run textiles and jute sectors.

Currently, there are six colleges, 12 diploma institutes and 26 vocational institutes for textiles, said Azam.

Md Shamsul Alam, director general of the Department of Jute, said Bangladesh gets Tk 1 on selling a garment item at Tk 4 but retains the whole amount in case of jute.

He expects a maund or around 40 kilogrammes of jute to sell for Tk 3,000 by 2021.

Jute traders get bank loans at 20 percent interest while other exporters can borrow from the export development fund at only 2 percent interest, said A Barek Khan, secretary to Bangladesh Jute Mills Association.

Mahmudul Hasan, chairman of Bangladesh Jute Mills Corporation, said they needed investment from either the government or the private sector to commercially produce paper from jute, something already proven in laboratories.

Moreover, by making viscose and paper pulp from jute at home, Bangladesh can save Tk 1,700 crore while earning $7 billion from jute and jute goods exports a year, he said.

AFM Akhtaruzzaman, former director of Bangladesh Forests Research Council, said it was also possible to make high-value papers such as that for cheques, stamps and currency notes with jute.

Abul Kasem Khan, DCCI president, called for enacting an act on mandatory use of jute and jute goods.

In a keynote paper, Rashedul Karim Munna, managing director of Creation Private Ltd, said many renowned car brands like BMW, Audi, Mercedes-Benz, Renault, Chrysler, Mitsubishi and Volvo have started making different environment-friendly components using jute.

“So, the government should make a policy to export $5 billion-$7 billion worth jute in the next seven years,” he said.b