The Indian Jute Mills Association (IJMA) has said that the reduction in procurement of jute bags for sugar for the upcoming season will “adversely impact” the industry.

According to the new provisions, 20 per cent of sugar will have to be mandatorily packed in jute bags.

Currently, it is mandatory to pack 40 per cent of sugar in jute bags.

As a result, sales from the 80-odd jute mills across the country is expected to drop substantially, S. Majumdar, Director General, IJMA, said.

“There has been a substantial decline in orders from Government agencies for jute bags. Further reduction in procurement will hit the industry badly,” he told reporters during a press conference here.

for different agencies

The Directorate-General of Supplies and Disposals (DGS&D), under the Ministry of Commerce and Industry, purchases jute bags (having 50 kg capacity) for different Central agencies.

Currently, the Centre procures two types of jute bags – one for foodgrains and another for sugar. In case of foodgrains, it procures 90 per cent of the total production.

Full procurement

According to IJMA, the Centre should restore 100 per cent procurement of jute bags for foodgrains and sugar.

While, this was the practice till 2010-11, changes were initiated 2011-12 onwards.

In 2011-12, the mandatory procurement across both categories was reduced.

In 2012-13, the procurement for sugar only was reduced.

However, Subrata Gupta, Jute Commissioner, said that the industry has been witnessing a shortage in supply of jute bags in the last couple of years.

“Since supply was short and total requirement was not met on earlier occasions, the Centre decided to reduce procurement (from jute bag makers),” he said.

According to the Jute Commissioner, lack of competitiveness among jute mills due to higher dependency on Government for mandatory procurement is impacting the industry.