History of Jute Industries

Chapter 1 Introduction 1. Introduction Jute is a natural graphic symbol with golden and silky shine and is known well as The Golden lineament. It is the cheapest vegetable part procured from the skin of the plants stem. Jute is the second somewhat important vegetable reference after cotshort ton, in hurt of usage, globose consumption, fruit, and availability. It has high tensile strength, low-spirited extensibility, and ensures better breath ability of fabrics. Jute fiber is wizard hundred% bio-degradable and recyclable and thus environmentally friendly.It is one of the most versatile natural fibers that have been utilise in crude(a) materials for packaging, textiles, non-textile, construction, and agricultural sphere of influences. It helps to make best quality industrial narrative, fabric, utmost, and sacks. Jute, the golden fiber, is the raw material for one ofBangladeshs oldest industries. The kickoff jute mill started product in Bengal in 1856. by and by mo re than 150 long time the jute intentness is now challenged by competition from alternative materials, by the recession in the outside(a) trades and by low sensation among consumers of the versatile, eco-friendly nature of jute fabric itself.Yet this industry still set ups a documentation to more than 250,000 mill workers and more than 4 billion farmers families. It is a golden bond with the Earth its employ is a statement about ecological aw atomic number 18ness as it is a fully bio-degradable and eco-friendly fiber. It comes from the earth, it helps the earth and once its life is done it merges back into the earth. Advantages of jute include good insulating and antistatic properties, as well as having low thermic conductivity and moderate moisture regain.It includes acoustic insulating properties and manufacture with no skin irritations. Jute has the ability to be blended with early(a) fibers, both synthetic and natural, and accepts cellulosic dye classes such(prenominal ) as natural, basic, vat, sulfur, reactive, and pigment dyes. While jute is being replaced by relatively cheap synthetic materials in many uses, butjutes biodegradable nature is able for the storage of food materials, where synthetics would be unsuitable. 1. Report Background One of the unavoidable aspects of modern business studies is exposure to the practical experiences.As a part of the BBA program requirement, I was assigned by my honorable course instructor Prof. Dr. Nargis Akhter to prepargon a Project Work on The History of Jute Industries to fulfill the requirement of 3 creed course, Course Code BUS 498. It endowed me with the opportunities to experience the real life exposure to the Jute arenas of Bangladesh. 2. Methodology In order to prepare the project report I use both secondary and primary data. For primary data I talked to some employees of BJMC and BJMA all(prenominal)where phone and face to face.I also crosschecked the information order all over the internet by some people. For secondary data, I used the vast knowl distinctness of internet, the websites of assorted research organizations, different countersign websites and different article found in the internet. 3. Scope & Limitations For this report, I used graphs, chart, tables etc to show necessary information. Firstly, the history of jute industry in the Indian subcontinent has been described elaborately. The history is divided into four separate such as, Ancient Period, Pre-colonial period, post colonial period, after topicization.The outturn, sales, contribution of jute industries in Bangladeshi economy, present condition, labor unrest, industrial relations situations etc. are discussed afterwards. in the long acquit I have sum up by some recommendations and showing my findings and analysis. Chapter 2 Literature Review 2. Literature Review The paper titled Jute Manufacturing sphere of Bangladesh Challenges, Opportunities and Policy Options, written by Khondokar Golam Moazze m, MD. Tariqur Rahman, Abdus Sobhan, is all about issue and sales of jute mill about, prospects of jute mill features and challenges faced by the jute mill around of Bangladesh 1.News published in Financial coiffe forward is about the demand fulfilled by the jute industries, the ill management of jute industries and the present management situation of jute industries in Bangladesh 2. An article published in Business standardised in 31 celestial latitude 2009 written by the will reporter Bhubaneswar which says that Jute industries of India seeks ban on imports of Bangladeshi jute goods for positive success of their own jute goods3. The article says the news about 48 hour strike held in state owned jute mill.The workers called the strike along with the trade union members for their right of bring ind wages and other arrears 4. Information from the website gives a thorough idea about the earlier history of jute industries in Bangladesh 5. The website provides jute related new s about Bangladeshi jute industries. It consists of the news of 2009, 2010, 2011 and 20126. On 18 March 2012, workers threaten to go on strike, a report by Arafat Ara published in Financial express 7. Government targets to double the fruit within 2011-128.While writing on history of jute industries some authentic information were found in the cited website 9. Some valuable information about the history of jute industries in the Indian subcontinent were found in the website of jute industries 10. Jute Dilemma an article by Khalid Rab published in twentieth Anniversary supplement of The Daily Star newspaper on March24, 2011 Thursday that talked about the dissatisfactory performance of the jute sector 11. Chapter 3 Findings 3. 0. History of Jute Industries 3. 1. Jute in Ancient Time (Pre-Colonial Period)Jute has been used since ancient times in Africa and Asia to provide cordage and weaving fiber from the stem and food from the leaves. In several diachronic documents ( Ain-e-Akbari b y Abul Fazal in 1590) during the era of the great Mughal Emperor Akbar (1542 1605) states that the poor villagers of India used to wear clothes made of jute. Simple handlooms and hand spinning wheels were used by the weavers, who used to spin cotton yarns as well. History also states that Indians, especially Bengalis, used ropes and twists made of w tallye jute from ancient times for household and other uses.Chinese papermakers from very ancient times had selected almost all the kinds of plants as hemp, silk, jute, cotton etc. forpapermaking. Qiu Shiyu, detective of the Harbin Academy ofSciences and expert of Jin history, concluded that Jews used to take part in the work of designing jiaozi,made of coarse jute paper. A small, piece of jute paper with Chinese characters written on it has been discovered in Dunhuang in Gansu Province, in northwest China. It is believed it was produced during the Western Han Dynasty (206 BC220 AD). 3. 2. Colonial PeriodThe British einsteinium India Company was the British pudding stone Authority delegated in India from the 17th centimeury to the mid(prenominal)dle of 20th century. The company was the first Jute trader. The company traded mainly in raw jute during the 19th century. During the start of the 20th century, the company started trading raw jute with Dundees Jute assiduity. This company had monopolistic access to this trade during that time. In 1793, the East India Company merchandiseationed the firstconsignment of jute. This first shipment, 100 tons, was followed by additionalshipments at irregular intervals.Eventually, a consignment found its way toDundee, Scotland where the flax spinners were anxious to learn whether jutecould be goed mechanically. During the same period, the Scotlanders were experimenting on whether jute fiber can be mechanically processed. 1830 is the year when the flax machines were used by Dundee spinners for spinning jute yarns. Since Dundee mill was the only supplier of jute, the use o f flax machine ultimately led to augment in production and export of jute products in entire continent. Margaret Donnelly I was a jute mill landowner in Dundee in the 1800s.She set up the first jute mill about in India. The Entrepreneurs of the Dundee Jute Industry in Scotland were called The Jute Barons. Starting in the 1830s,the Dundeespinners learned how to spin jute yarn by modifying their power- operate flaxmachinery. The rise of the jute industry in Dundee saw a corresponding increase in theproduction and export of raw jute from the Indian sub-continent which wasthe sole supplier of this primary commodity. The major jute developing areas were mainly in Bengal at the Kolkata side. Calcutta (now Kolkata) had theraw material close by as the jute growing areas were mainly in Bengal.Therewas an abundant supply of labor, ample coal for power, and the city was ideally determined for shipping to humans markets. The first jute mill was established atRishra, on the River Hooghly ne ar Calcutta in 1855 when Mr. George Auclandbrought jute spinning machinery from Dundee. Four years later, the first power grindn weaving factory was set up. Although Bengal, particularly Eastern Bengal, was the main producer of quality raw jute, the first jute mill was established at Risraw near calcutta on the bank of the hughli only in 1855, after 20 years of mechanical spinning of jute in Dundee.The delay was due(p) to the non-availability of technical hands and power to drive machines. In 1854, coal mines were opened at Raniganj. Attracted by the easy availability of power, George Aucland, an Englishman established the first jute mill. But he could non make reasonable profits and left the business. In 1859, the Bornee Company founded the second mill with spinning and weaving facilities. Unlike the Aucland mill, it started prospering after its establishment. Figure 1 Dundee Jute Mill in Scotland. The Entrepreneurs of the DundeeJute Industry in Scotland were called The Jute Bar ons. Figure 2 Dundee Jute Mill in Scotland. In 1833, Jute fibre was spun mechanically in Dundee, Scotland. Within five years it doubled its plant size. By 1866, terzetto new move were established. Between 1868 and 1873, these move made large profits. Five new companies started in 1874 and eight more in 1875. Thus Bengal go done a real boom in jute industry towards the end of the nineteenth century. With the establishment of jute mill, Bengal became a major exporter of arc bags.Calcutta appeared to be a strong adversary of Dundee and successfully penetrated into Dundees capital of New Zealand market in many parts of the introduction, including America, primarily because Calcutta had the cost advantage in producing jute goods. Secondly, it was situated in close proximity to the jute growing districts of Eastern Bengal and Assam. Thirdly, it had cheap labour. Fourthly, the mills ran for 15 to 16 hours, and sometimes even for 22 hours daily. This led to a clear advantage of Cal cutta manufacturers in monetary terms. Moreover, they could put up a finer quality of jute.In sixty years between 1880 and 1940, the number of mills increased by 5 times, that of looms by about 14 times, of spindles by 19 times, and of persons employed by 11 times. The appendage of the industry was significant during the 20 years between 1900 and 1920. During the Great Depression of 1929-33, the jute industry was severely hit since the demand for jute goods dec borderd drastically throughout the world. In the following three decades, the jute industry in India enjoyed even moreremarkable expansion, rising to commanding leadership by 1939 with a summarize of68,377 looms, revolve aboutd mainly on the River Hooghly near Calcutta.Thesemills a lonely(prenominal) have proved able to supply the world demand. Several historical events were responsible for the growth of the jute industry. In 1838, the Dutch brass specified bags made of jute instead of flax for carrying coffee from the E ast Indies. At that time flax was imported from Russia. But the Crimean war of 1854-56 led to the stoppage of supply of flax from Russia and forced Dundee, the famous jute manufacturing centre of UK, to note for substitutes.In Dundee the flax mills were reborn into jute mills. The American Civil War (1861-65), on the other hand, gave save impetus to the jute trade, as supplies of American cotton were much restricted. Since then, the industry did not return to flax or cotton again. The main reason for this permanent shift had been its comparative degree cost advantage. The jute industry grew fastly and jute mills were established in many countries, including USA, Germany, France, Belgium, Austria, Italy, Holland, Spain, Russia, Brazil and Bengal.This led to a rapid increase in the demand for jute. The Bengali peasants responded quickly to chance the world demand by increasing the area down the stairs jute finale. The out hand of the First human War led to a rapid increase in the demand for raw jute, since it was used to manufacture sandbags to protect soldiers in trenches and to produce gunny bags for carrying food grain for the army. Inevitably, the price of jute also rose sharply. get across 1 Growth of jute industry in Bengal, 1879-1939 Year mill about Looms Spindles Employment 1879-80 22 5,000 71,000 27,000 1900-01 36 16,100 331,400 114,800 1920-21 77 41,600 869,900 288,400 1938-39 110 69,000 13,70,000 299,000 Before it was put to industrial use, jute was used mostly for domestic purposes. With the conversion of the Dundee flax mills into jute processing mills, the demand for jute increased manifold in the world. Bengali peasants were highly experienced in jute civilisation and could respond quickly to meeting this increased demand. In 1872, when industrial use of jute had begun, it was mainly grown in the districts of pabna, bogra, darjeeling, dinajpur, rangpur and Hughli (West Bengal). The ratio of land beneath jute cultivation to total c ropped land in these districts in 1872 was 14%, 11%, 9%, 7%, 6% and 5% respectively.Subsequently, jute cultivation spread to other districts. In 1914, pencil lead districts in terms of the above ratio were Rangpur (28%,) Bogra (25%), Tippera (comilla, 24%), Pabna (21%), Dhaka (18%), Faridpur (16%), Hughli (West Bengal, 13%), Rajshahi (11%), Jessore (10%), Nadia (10%), and Dinajpur (7%). After the end of the First World War in 1918, the world demand for raw jute decreased. This had a negative impact on the area under jute cultivation. The situation worsened for jute cultivation during the Great Depression of 1929-33. The prices sank so low that jute growing became unprofitable.As a result, peasants greatly slim down their area under jute cultivation. By 1939, economic recovery took place. The breaking out of the Second World War caused an increase in the demand for jute and between 1939 and 1945 peasants put more areas under jute cultivation. The earliest goods woven of jute in Du ndee were coarse baggingmaterials. Withlonger experience, however, finer fabrics called burlap, or hessian as it isknown in India, were produced. This superior cloth met a ready sale and,eventually, the Indian Jute Mills began to turn out these fabrics.The natural advantage these mills enjoyed soon gave Calcutta world leadership in burlap and bagging materials and the mills in Dundee and other countries turnedto specialties, a great variety of which were developed. 3. 3. Post-Colonial Period After the fall of British Empire in India during 1947, it was found that all jute mills of the region degenerate in West Bengal, which became a part of India and all major jute growing districts became part of East Bengal, a province of Pakistan. Because it had no jute mills, East Bengal faced problems in marketing of raw jute.The problem was, however, quickly overcome by establishing jute mills in East Bengal. During that time, most of the JuteBarons started to evacuate India, leaving behind t he industrial setup of the Jute Industry. Most of the jute mills in India were taken over by the Marwaris businessmen. In East Pakistan after partition in 1947 lacked a Jute Industry buthad the finest jute fiber stock. As the tension started to rise between Pakistan and India, the Pakistani entangle the need to setup their own Jute Industry.Several groups of Pakistani families (mainly from West Pakistan) came into the jute business by setting up several jute mills inNarayanganj of then East Pakistan, the most significant ones are Bawanis, Adamjees,Ispahanis and Dauds. 3. 4. After Nationalization After the liberation of Bangladesh from Pakistan in 1971,most of the Pakistani owned Jute Mills were taken over by the organisation of Bangladesh. Pakistani mill owners (about 68% of the total loom strength) left the artless, leaving the industry in disarray. Abandoned jute mills were subject to heavy looting.The new government of Bangladesh had to take up the responsibility of rebuilding the industry. By a nationalization order, about 85% of industries, including all jute mills, were nationalized. Later, to control these Jute mils in Bangladesh, the government built up Bangladesh Jute Mills sight (BJMC). Bangladesh Jute Mills Corporation (BJMC) was formed to manage and look after all the 73 jute mills having 23,836 looms at that time. At one coiffure the number of jute mills under the jurisdiction of BJMC went up to 78. BJMC had to resurrect the industry from a ruined position.Immediately after liberation, it became very difficult to solve problem of pecuniary hardship of the jute industry because financial institutions were not working well. Frequent power failures and power stoppages also compelled the industry to suffer heavy losings in terms of production and foreign exchange earnings. In addition to these problems, the short supply of spares, labor unrest, wastage in production etc. also shook the industry severely. For jute industry of Bangladesh, the firs t two years after liberation was the period of reorganization.The government offered cash subsidy to the industry, which amounted to Tk 200 million annually. The annual cash subsidy was reduced to 100 million since 1976-77. Thanks to this policy and periodic devaluation of currency, Bangladesh could retain its position of a prime exporter of jute goods in the dollar areas of export. The industry earned profit in 1979-80, when the subsidy was withdrawn. By December 1979, BJMC had 77 jute mills, two carpet backing mills, and two spare parts producing units. In 1980, six twine mills were disinvested to the surreptitious sector.In June 1981, BJMC had 74 mills under its administration. These mills had about 165,000 workers and 27,000 managerial and office staff. 3. 5. Denationalization Denationalization of jute mills started in July 1982. The government ordered BJMC to complete the process by 16 December 1982, but only 10 mills could be handed over to Bangladeshi owners by that time. T he valuation process and dependency of other organizational matters relating to handing over of the mills took a long time.Among the jute mills owned by BJMC, 46 had satisfactory financial performance in 1982-83, when their profit before contribution to national exchequer was about Tk 240 million. The same mills incurred total losses of about Tk 430 million in the previous year. Jute mills incurred losses regularly over years and external donor agencies pressed hard for denationalization. More and more mills were put into the denationalization list. In 1999, BJMC had 33 mills. The World Bank continued to work closely with the government to restructure the jute sector, especially through denationalization, merger, dissolution, closure and setting up of new units.By 1998, BJMC had an accumulated loss of more than Tk 28 billion and a debt of more than Tk 11 billion. Losses incurred by BJMC in 1997-98 were Tk 2. 38 billion. Major features of the BJMC mills in that year were total produ ction capacity 451,707 tons looms in operation 12,350 loom hours 59. 3 million production per loom hour 5. 33 kg baled production 312,000 tons consumption of raw jute 319,306 tons local sales 29,000 tons export 256,000 tons value of total sales (including export bonus) Tk 8. billion production cost per ton Tk 30,349 wages paid to workers Tk 3. 89 billion and salary paid to employees and executives Tk 881 million. 3. 6. Performance of private sector The performance of the private sector jute industry is also not encouraging. privatization itself has been a very problematic and slow process. Resistance from workers/employees of the mills and lengthy formalities forced the process to be slow. In 1998, out of forty jute mills in the private sector, three were closed and two laid off. The private sector jute mills run on a very low profile.Up to December 1999, the private sector jute mills have accumulated losses of more than Tk 12 billion. The jute spinning mills in Banglades h export closely 100% of their production. In 1998, there were 41 spinning mills, which had an annual production capacity of about 195,000 tons. Products of these mills are yarn and twine, which are used the world over, for carpet weaving, skirt covering, jute webbing, fabrics for shopping bags, caps, handicrafts, canvas, decorative fabrics, laminated cloth, and safety fuse for explosives.These mills employ about 25,000 people and the employers have their own trade body named Bangladesh Jute Spinners Association. 3. 7. An overall trend of production and sales 3. 7. 1. Trend of production drudgery trend of the jute manufacturing sector can be broadly categorized into four periods first strain (1950-1970) second phase (1972-1981) third phase (1982-1990) and fourth phase (1991-onward) (Figure 1). During these four phases, jute manufacturing sector had experienced various changes in policies, and also in the pattern of utilization of jute and jute goods.In the pre independence perio d, jute mills were owned by a small number of private entrepreneurs. During this phase, average hessian production was 155,586 metric ton (MT) per year, of which 87 per cent was exported the comparable figures for sacking were 267,614 MT and 78 per cent respectively. Production reached its peak in 1969, with an output of 5. 74 lakh MT. Due to political instability and damages caused during the year of hammock in 1971, operations of jute mills were interrupted. Consequently, production declined in 1971 and 1972. Thereafter, production started to increase.In the second phase (1972-1981), government decided to nationalize the jute manufacturing sector, and took control of all the private sector jute mills. During the 1970s, average direct of production of hessian was about 165,000 MT, of which 94 percent was exported, while comparable figures for sacking were 225,460 MT and 86 percent respectively. Growth in the production of jute goods between 1960 and 1980 can be attributed to the growth in production of hessian, sacking and carpet backing cloth (complete blood count) products. Figure 3 Production of different kinds of jute goods, 1960-2006 (Source BJMC, BJMA and BJSA)Table 2 Periodic trend of jute goods production Period Hessian Sacking CBC Yarn/Twine Up to 1970 155,586 267,614 23,929 0 (86. 9) (78. 2) (96. 7) (0. 0) 1972-80 165,033 225,458 63,578 1,953 (93. ) (86. 3) (95. 5) (73. 3) 1981-91 219,048 270,556 80,415 61,090 (94. 8) (83. 7) (97. 0) (69. 1) 1992-05 87,968 96,839 39,777 163,830 (99. 5) (71. 7) (89. 7) (90. ) Production of yarn/twine accounted for a small dowery of total production during the 1970s. During the 1980s (third phase), the then government decided to denationalize a number of jute mills in line with the initiative of economic liberalization. A mixed trend is observed in the production of jute goods during this phase, which reached its peak in 1990 with a production of 5. 96 lakh MT. Production of yarn gradually increased i n the 1980s. Most importantly, production of hessian and sacking- two major traditional products gradually declined, especially since the late 1980s. Production of CBC declined as well.In the fourth phase (1990-onward), following the suggestions of the World Bank, government started to denationalize a number of other public sector jute mills which resulted in the resolution of many jute mills as well. However, production of jute goods has not picked up even after adoption of various policy measures. Indeed, production of traditional products such as hessian, sacking and CBC has continued to decline with the exception of growth in the production of yarn and twine. Yarn/twine now accounts for the major portion of jute goods and over time, its production has also been on a steady rise.During 2006, Bangladeshs share in the global production of jute goods was approximately 18 per cent. 3. 7. 2. Trend of Sales twain public and private sector jute mills sell their products in either the domestic market or the international market. Although overseas export comprised major share of Bangladeshs jute goods production, domestic sale has been posting a rise, which now accounts for 38 per cent of the total production. Bangladesh is the leading exporter of jute goods in the world and her share in the global market is gradually increasing- which accounted for 60 percent of the global exports in 2006.If export of raw jute is taken into account, total export would reach more than 75 per cent. correspond to Bangladesh Jute Association (BJA), Bangladesh exports about 25 lakh bales of jute goods which accounted for about 56 per cent of the total raw jute grown in the democracy. It is worth noting here that Bangladesh and India currently meet more than 90 per cent of the global export demand for jute and jute goods to compare, this share was 79 per cent in 1970. pic Figure 4 Sales in home(prenominal) and International market (%) 3. 8. Contribution in Economy The contribution o f jute sector to economy of Bangladesh is enormous.Bangladesh holds the 2nd position as a Jute producer in the world with the average production of Jute 1. 08 m ton/Year. More than 85% of world production of Jute is cultivated in the Ganges Delta & having the major portion of it Bangladesh became the largest producer of black Jute or Jute Fiber in the world. For centuries, Bangladeshi Jute had and still has demand in the international market for higher quality fibers. This fact makes Bangladesh the major exporter (80% + market share) of Jute Fiber in the world while India has nominal dominance over export of Raw Jute Fiber.Total average export earnings from jute and jute goods are US$ 611 million (60 lakh bales)/Year. Average export value of raw jute is US$ 140 million and the numbers of factories are 187. Earnings from jute and jute product exports hit the billion dollars mark for the first time in the countrys history in 2010. Jute sector is contributing 4. 68 percent in export e arning last fiscal year and two per cent increase during 2009-10. This sector has been generating employment to a large segment of total population of the country, directly and indirectly over the years. Bangladesh produces 5. -6. 0 million (55-60 lakh) bales of raw jute every year of which some 3. 2 million (32 lakh) bales are used in the lively 148 jute mills. The country exports 2. 4 million (24 lakh). The total demand for jute goods in the international market is 0. 75 million (7. 50 lakh) tons. Bangladesh exports 0. 46 million (4. 60 lakh) tons of jute goods while India enjoys a share of 0. 285 million (2. 85 lakh) tons in the international market. Dhaka controls 62 per cent share of the total jute goods market of the world and earn Taka 20. 125 billion (2012. 5 crore) by exporting jute goods.Bangladesh is the lone exporter of raw jute. In the year 2006, the country exported 2. 4 million (24 lakh) bales of raw jute valued at Taka 9. 77 million (977 crore). In total Bangladesh fetched Taka 29. 395 billion (2939. 5 crore) by exporting raw jute and jute goods. There are 50 private jute spinning mills producing jute yarn/twine under Bangladesh Jute Spinners Association (BJSA). The mills under jute spinning sector produce 0. 29 million (2. 90 lakh) tons of jute yarn/twine and export 0. 261 million (2. 61 lakh) m. tons of quality yarn/twine consuming 1. 9 illion (19 lakh) bales of high quality raw jute and earn foreign exchange worth Taka 12 million (1200 crore) per annum. 3. 9. Present Situations It has been recognized that Jute and confederative fibers occupy a unique position as eco-friendly, bio degradable, renewable natural fiber. We should also understand that Jute sector of Bangladesh has made and continues to make significant contribution to the national economy. Apart from its versatile use from domestic area to industry, it protects environment from different ways. All the export earnings from the Jute Industry vis-a-vis Jute sector are net foreign c urrency earnings.Domestic value additions are exceptionally high. So, a viable Jute Industry would be an ideal type of activity for the economic development of the country. We should eternally consider that Jute Industry is indigenous one. Jute, of the best quality in the world, is available in Bangladesh. It is one of the few natural re extensions that the country has and it has provided Bangladesh with a comparative edge in the world trade in jute goods. But, over the past decade, the jute industry has suffered more downs than ups for no fault of its own.It has been allowed to suffer gradual decline mainly due to lack of appropriate policy actions. Jute industry in Bangladesh (erstwhile East Pakistan) was established as export oriented industry with the aim of rapid industrialization. It became the major source of foreign currency earnings. The industry was made viable and kept expanding with the Govt. financial assistance on export of jute goods through bonus voucher. After libe ration of the country in 1971 and nationalization of the Industry in 1972, such financial assistance to Jute Industry was withdrawn and the Industry started incurring losses.On the other hand, the newly established BJMC had to concentrate mainly on rehabilitation of the war torn Jute Industry and expand the world export market share which was taken by the competitors during war of liberation. At the initial stage Bangladesh Jute Industry i. e. BJMC had to face serious problems to recover the lost market. By the untiring efforts to improve the management, production and export, the Industry i. e. BJMC started achieving positive results from 1973-74 with the production of viosterol grounds tons and export of 445 cubic yard tons from 320 metre tons and 225 honey oil tons respectively of 1971-72.With help of pie chart the result can be shown in the following. pic Figure 5 Bangladesh Export in Major Products during 1972-73 In 1977-78 BJMC could achieve an export of 531 thousand tons , mainly traditional products (hession, sacking & CBC) against the previous highest export of 506 thousand tons in 1969-70. In 1980-81 Jute Industry could achieve highest production of 590 thousand tons exceeding the production of 1969-70. In 1981-82, the Jute Industry again could break the export record of 1969-70, exporting around 537 thousand tons against production of 586 thousand tons.Large scale denationalization started in 1982-83. But, private sector jute mills could not perform the way it was expected for many reasons. As a result, performance of the overall Jute industry started deteriorating gradually from 570 thousand tons (production) and 514 thousand tons (export) in 1982-83 to 286 thousand tons (production) and 192 thousand tons (export) in 2003-04. It is seen in the figure below more clearly. pic Figure 6 Bangladesh Export in Major Products during 1993-94 During eighties the new jute yarn/twine mills came into the picture and expanded gradually.It could increase expo rt of yarn/twine from 28 thousand tons in 1983-84 to around 380 thousand tons in 2009-10. The gradual increase in the production and export of yarn/twine could help increase of overall export of Jute products to nearly 600 thousand tons with the share of only around 200 thousand tons of traditional products i. e. Hessian, sacking & CBC. It may be seen from the figures given below that production and export of BJMC and BJMA mills (mainly traditional products) recorded gradual decline over the years. Table 3 Productions and Export of BJMA and BJMC Mills Year Production Export 1981-82 587 thousand tons 537 thousand tons 1991-92 416 thousand tons 408 thousand tons 2001-02 321 thousand tons 257 thousand tons 2009-10 302 thousand tons 219thousand tons fleck in current financial year is also not encouraging in BJMC & BJMA mills as may be seen from the table (6months/ July-Dec10) below. Table 4 Production and Export of BJMC & BJMA Mills during July-Dec10 Types of Mills Production Expo rt BJMC 78 thousand tons 56 thousand tons BJMA 60 thousand tons 37 thousand tons Total 138 thousand tons 93 thousand tons However, the production and export of yarn/twine mills mainly under BJSA (Bangladesh Jute Spinners Association) recorded increase gradually from 50 thousand tons and 28 thousand tons in 1983-84 to 399 thousand tons and 380 thousand tons in 2009-10 respectively. It may be maintained during this financial year also on the basis of its production and export of 227 thousand tons and 193 thousand tons of July-Dec10.Table given below on the comparative position in production of traditional products reveal that while Bangladesh jute industry is sinking, Indian jute industry is booming. Table 5 Comparative Position of Bangladesh & India in Production of Traditional Products Years Bangladesh India 1999-2000 3. 10 lac tons 12. 45 lac tons 2005-2006 2. 43 lac tons 13. 42 lac tons 2009-2010 2. 54 lac tons 14. 50 lac tons The present govt. has taken some positive step s to revitalize the Jute Industry, particularly BJMC mills. But, piece meal action exit not serve the purpose because, production and export of traditional products, both in BJMC and BJMA (private) mills recorded gradual decline to a frustrating level over the years. A recently-created demand for jute sacks in Thailand has come as a boon for the jute industry in Bangladesh, raising hopes for a recovery in exports that fell 13 percent during July-February of the current fiscal year. Also, India has recently increased import of jute and jute goods after its currency started to gain against the US dollar.According to MD Shamsul Haque, director (marketing) of state-owned Bangladesh Jute Mills Corporation that has 21 jute mills running, Exports of jute goods to our traditional middle-eastern and African markets have fallen amid political unrest in Libya, Syria, Iraq and other countries. But our exports increased in the last three months as we got some new markets, Thailand have emerged as a new market for our jute sacks along with Vietnam. The market in Thailand has widened after the current Thai-government started buying a huge quantity of rice in jute sacks to fulfill its pledge of providing a guaranteed price to farmers. Bangladesh has received orders for supplying two crore (20 million) pieces of jute sacks from millers in Thailand. Thailand has opened up a new opportunity for Bangladesh. It has come as a blessing as Bangladeshs stocks were piling up due to a fall in exports.Private jute mills testament also be benefited due to the decision of Thailand, which is the largest exporter of rice and forecasts to produce 30 million tons of rice in 2011-12. Thailand needs three million pieces of bags a month to package rice which means around 36 million pieces of sacks will be required a year. According to Mahmudul Haque, managing director of Janata Jute Mills Ltd, Demand for jute sacks is high in Thailand. He said, as his mill alone could not meet the orders, he tied up with two other mills. Janata ships 3. 2 lakh pieces of jute sacks a month to Thailand, he said. Exporters said the increased demand and higher prices of jute goods will allow them to narrow down the losses in export receipts in the first half of the year.But it may not be possible to offset the past fall and post a positive growth in exports by the end of the fiscal year on June 30, 2012. Export receipts from the jute industry- the second biggest export earner- fell 13. 66 percent to $615 million in the July-February period of the current fiscal year, from $712 million during the same period last year, according to Export Promotion Bureau. In the following figure, workers carry bundles of jute sacks at a factory in Bogra as, Thailand and Vietnam have emerged as new markets for jute sacks. pic Figure 6 Workers carry bundles of jute sacks at a factory in Bogra (source STAR magazine, March 27, 2012).Total figures are not available readily, it reveals from some of the available figures that export of BJMC in the major importing regions e. g. Australia, America, Middle East, Europe, Africa recorded sharp decline in recent years mainly because of decline in production and absence of effective marketing efforts. Present situation of the industry calls for immediate measures/actions in the following areas ? The new challenges and opportunities presented by the changing global environment of integration in the development of natural fibers ? Modernize the jute industry to improve efficiency in production and processing to reduce cost and enhance product quality.With the rise of inescapable competition facing our jute sector, in the international field it should be our endeavor to facilitate upgrading the skills of the Workers, Supervisors and Managerial staff who are employed in the Jute Industry. ? Involve and ensure the active co-operation and partnership of Corporation, Financial Institutions, Energy supplying Agencies and Entrepreneurs in the fulfillment of these objectives. ? Power shortage should be reduced either by power supplying agencies or by setting up generators (gas or diesel) in such mills where it is required. ? The efforts need to be put with all earnestness to bring the efficiency level to at least 80%. ? So far management at the mill level is concerned it should be linked to productivity and efficiency. Enable the jute industry to build world class state-of-the-art manufacturing capabilities in conformity with environmental standards, and for this purpose, to encourage immaterial Direct Investment as well as research and development in the sector. ? Aggressive marketing measures need to be undertaken internationally. Markets like Africa and Middle East should be given top priority to recover the lost market. 3. 10. Major drawbacks Major problems of the jute mills are as follows Increase in the cost of production while the sales prices of jute goods remain at the same level or even decline Accumulation of huge losses and consequently, of huge debts Decline in exports of jute goods Electricity failures Excessive wastage Labor unrest Poor management that affects productivity and frequent changes in government policies High cost of jute goods compared to synthetics led jute goods users to turn to synthetics. last Remarks Before the independence, the country had six jute yarn mills. However, this sector had flourished during the 80s as the industry experienced a setback in the developed countries during the same period. The entrepreneurs of the country bought these second-hand jute mills machineries with a very low investment and started setting up these jute spinning mills. Two types of opinion exist in Bangladesh over the management of existing mills under BJMC. One group is in favor of privatization of the xisting state owned jute mills, where another group advocates reorganization/restructuring of BJMC mills. The mills under Bangladesh Jute Mills Corporation are exporting 0. 128 million (1 . 28 lakh) m. tons of jute goods i. e. Hessian, Sacking and CBC. Mismanagement, corruption, inefficiency and lack of skilled manpower have gripped the BJMC mills. The mills should be run professionally to remain emulous in the open market but that are not practiced in case of BJMC, which is causing hundreds of millions of taka losses to the national exchequer. Time has come to put pragmatic/realistic thought on the jute sector to revive this promising sector. The government should devise plans to bring back the glory of the golden fibre.The demand for environmental friendly jute products are on the rise in the global market and Bangladesh should tap this opportunity by implementing some short-, mid- and long-term plans to rejuvenate the ailing jute sector of Bangladesh. At present it is useless to be nostalgic about old prime era of our jute industry. Now we must formulate a pragmatic short, mid and long-term plan keeping in mind about future needs of jute goods demand. Instead of remembering past mistakes, we must take lessons out of that and look forward with practical solutions which will bring back viability to our ailing Jute sector. This should be our only prime object. Recommendations Some recommendations are prescribed below to be considered by the government in the greater interest of the jute sector To revive the glory of the jute industry, a high-powered committee should be constituted comprising the Finance Secretary under the direction of the Chief Adviser. The government should implement some short-, mid- and long-term proposals in a bid to revive the jute sector. The exiting jute mills of the Bangladesh Jute Mills Corporation should be converted into public limited companies keeping some shares in the hands of the government like that of the Bangladesh Biman. The government may create a Regulatory Board to run its existing corporations professionally and efficiently. The Regulatory Body will monitor every unit of the corporation and ensure t heir accountability. The government should arrange a special fund to come on its existing jute mills to purchase necessary spares for machineries. Under this package the government will provide 50 per cent of the total credit as grants and banks will give rest 50 percent on a long-term credit to jute mills. Irregular power supply is adversely affecting production of existing jute mills by cutting their competitiveness. The government may ask donor agencies like the World Bank (WB) and the Asian Development Bank (ADB) to arrange a special fund to provide long term loans at 3. 00 per cent interest to the existing jute mills to help them to procure stand-by generators. The use of stand by generators by the jute mills will help to save electricity at our national grid. Government is giving 7. 5 per cent cash incentives on jute goods exports. To expand the market and increase competitiveness, the rate of cash incentives should be raised to 15 per cent from present rate. The government should enact a law making mandatory or compulsory to use of jute bags for internal consumption in packaging. To meet requirement of local markets, an initiative is necessary to pack sugar, rice and pulse in 5-10 K. G. jute bags. The use of jute goods in the local market is limited. To increase the use, the government should also make law to use compulsory at least 20 per cent of total sugar and cement packaging with jute bags. The jute industries being an agro based and 100% export-oriented industry, the commercial banks are not implementing the Bangladesh Banks order to provide export credit at frown interest rate (7%), commercial banks should provide Export Cash Credit to jute mills which they give to the leather sector. Crisis of quality jute seed is a regular phenomenon in the country every year. The total requirement of jute seeds are 4,000/5,000 tons against government supply of only 400-500 tons. To meet local demand, sub-standard Indian seeds enter the Bangladesh market t hrough imports and smuggling. To improve the situation and ensure quality seeds, the government should set up seed bank to distribute seeds among planters at subsidized rate. Government should also arrange to provide fertilizer at subsidized rate. Bangladesh Jute Research Institute (BJRI) should also take appropriate measures to familiarize their new invention retting process among the farmers. Lack of skilled manpower has put the industries in grave situation. To overcome the situation at least a jute college may be arranged to set up at one of the closed BJMC jute mills. To address this situation promptly, government should introduce Diploma Course on jute in the six textile institutes as early as these are under the ministry of textile and jute. The significance of Mongla Port has increased as several hundred industrial units have been set in the southern part of the country recently. The government should initiate necessary steps to expand and develop the Mongla Port. The gov ernment should also take measures to promote and expand international trade of jute products by maintaining existing markets and by developing of new end users. References 1. http//cpd. org. bd/pub_attach/op78. pdf 2. http//www. thefinancialexpress-bd. com/more. php? news_id=14562 3. http//www. business-standard. com/india/news/jute-industry-seeks-banimportsbangladesh/381205 4. http//www. stoppressbd. com/home/news_details/66948 5. http//www. banglapedia. rg/httpdocs/HT/J_0137. HTM 6. http//www. worldjute. com/jute_bangladesh/bangladesh_jute_news. html 7. http//www. thefinancialexpress-bd. com/more. php? news_id=123813&date=2012-03-18 8. www. theindependentbd. com/business/finance/30375-govt-targets-to-double-jute-production-in-2011-12. html 9. http//www. worldjute. com/about_jute/juthist. html 10. www. jute-industry. com/history-of-jute. html 11. http//www. thedailystar. net/suppliments/2011/anniversary/part4/pg7. htm 12. http//www. bangladeshembassyinitaly. com/bangladesh. php 13. http//www. experiencebangladesh. com/bangladesh-business-jute. php 14. http//bangladesheconomy. wordpress. com/ socio-economic class/jute/