Death blow for jute

The jute sector, which was the backbone of Bangladesh's economy over the past many decades, is now fighting a losing battle for survival. Lack of proper planning, mismanagement, and mindless plundering were largely responsible for the dimming gloss of the golden fiber that was once the largest foreign currency earner of the country.
Though the country's climate is very much suitable for growing jute, the environment-friendly natural fiber, the farmers are losing interest in growing it. Farmers who still grow jute cultivate it only on those lands that are not suitable for growing any other crop during that season. The indiscriminate closure of jute mills has a snowballing effect on jute cultivation.
The government nationalised the jute industries along with other industrial units, and the Bangladesh Jute Mills Corporation (BJMC) started its journey in 1972 with 77 jute mills set up in the pre-liberation period. Following the sweeping nationalisation, the non-Bangladeshi owners, technical experts, and skilled manpower left the country. As a result, a serious vacuum was created in the jute mills.
On the other hand, the government appointed some inefficient persons with dubious character to run these jute mills. Eventually, the government was compelled to denationalise 35 jute mills between 1982 and 1985. Another 24 state-run jute mills faced closure at different times due to various factors, including mismanagement and rampant corruption. In fact, that was the beginning of the end of the jute era.
The World Bank (WB) is also blamed for the miserable state of our jute sector. The WB formulated the Jute Sector Reform Programme in 1991, and promised to provide $250 million to the government to implement it. The main objective of the reform was to privatise all the nationalised jute mills and find ways to make country's jute sector viable.
But the WB provided only $50 million, the first tranche of the loan, and stopped payment of the remaining $200 million on the plea of slow action in the privatisation process. Such unfair treatment by the WB only made the ailing jute sector more vulnerable.
The government also formulated a number of policies to revitalise the jute sector, but all were in vain. The policies include signing of an agreement with the WB, titled Jute Sector Adjustment Credit (JSAC), in 1994. The objectives of the JSAC were revitalising the jute sector through privatization, restructuring debt, decreasing the number of labourers and looms, and upgrading technologies. The WB has so far provided Tk 1,500 crore to the government in loan under the JSAC. But the JSAC could not revive the jute sector.
There exists a strong perception that the WB put pressure on the government to shut-down Adamjee jute mills, and is now promoting India's jute industries by downsizing our jute sector. India set up four new jute mills after the closure of Adamjee, and another three under- construction mills will go into operation soon, raising the total number to 92.
A big jute park on 152 acres of land near Kolkata is also going to be set up soon to cope with the growing demand for jute products in the global markets. India's Jute Compulsory Use Act facilitates the sales of jute bags in their local market by imposing restrictions on the use of all other packaging materials for grains.
It was the utter misfortune of the nation to watch woefully the closure of world's largest jute mill, which was the pride of the country, on July 1, 2002. The smooth operation of Adamjee jute mills during the post-liberation period was hampered largely due to political interference, mismanagement, and corruption. The people in power utilized the unit for their own purposes, without taking any initiative for saving the country's most vital industrial unit.
Bangladesh had dominated the global trade in jute for many years in the past, with 85 percent share in raw jute export and 65 percent share in jute goods export. The total quantity of hessian, sacking, and CBC produced in 1972-73 was over 450,000 tons, which grew to about 563,000 tons in 1982-83. But the production of these jute goods dwindled to about 242,000 tons in 2005-06 due to lack of pro-active policy support, sheer negligence, and indiscriminate closure of jute mills.
Bangladesh is now fast losing its foreign jute markets to India. The hasty decision to shut-down four jute mills in Khulna just on the ground of incurring losses was detrimental to the overall jute sector. Bangladesh lost a large volume of business in Ghana, Syria, Iran, and Sudan, as the buyers from these countries were apprehensive because of the closure of jute mills and were doubtful about delivery of the goods on time. These buyers have now moved to India.
A comparison of our jute exports with India's reveals that Bangladesh exported 14 lakh tons of jute goods in 1990, while India's share was only six tons, against 30 lakh tons of global demand. But the situation has been totally reversed now. The global demand for jute and jute goods has risen to 50 lakh tons, and India has seized the major markets. Bangladesh has failed to cope with the growing demand for jute goods in the world market with only 22 jute mills, as out of 82 mills 60 have already been closed.
The UN has declared 2009 as the International Natural Fiber Year. Bangladesh must not miss this golden opportunity to tap the full industrial potential of jute, which is widely known as a versatile and ecologically safe natural fiber.
A world-wide movement is currently on to find a substitute for wood as raw material for paper. Paper pulp can be produced from jute, a system which was evolved through successful completion of a project called Biotechnical Application of Enzymes. Paper pulp made of natural fiber like jute was sure to draw the attention of all in today's environment-conscious world. Unfortunately, there was no further development of the project.
Bangladesh's jute industry, the biggest producer and exporter of jute goods in the global market, is now regarded as a "sunset industry." Ironically, the jute sector in India has flourished tremendously over the past few years, while it declined alarmingly in Bangladesh. Really, our jute sector is now at its last gasp, and all because of wrong policies, mismanagement, and rampant corruption.
The sun has not yet set fully. In our view, there still are possibilities for bringing back the lost glory of our golden fiber. All we need is the right policy, and its uncorrupted enforcement. Substantial rethinking by the caretaker government is the need of the hour for rejuvenation of our jute sector, without going for indiscriminate closure of jute mills.

A.N.M. Nurul Haque is a columnist for The Daily Star.