Difficult times

Calcutta, Feb. 13: Over four million jute growers in India have taken a hit following the withdrawal of the import duty on raw jute from the beginning of this year.

A notification on waiving import duties on raw jute and jute products was issued by the customs authorities on December 31.

The scrapping of duty on jute products is going to hit manufacturers.

While raw jute attracted a duty of 6.88 per cent, the import duty on jute products was 9.63 per cent.

According to data obtained by the Jute Manufactures Development Council — a body of the Union textiles ministry — from the customs department, import of raw jute and jute goods last year was showing a rising trend even before the notification on a duty waiver was made.

Raw jute import during April-November 2007 at 1,39,259 tonnes was higher by 98 per cent compared with the import of 70,319 tonnes during the same period in 2006.

In value terms, imports rose 40 per cent to Rs 157.87 crore compared with Rs 112.84 crore a year ago.

In case of jute goods, imports were up to 35,780 tonnes from 34,562 tonnes a year ago, an increase of 3.5 per cent.

Imports, in terms of value, fell to Rs 85.51 crore from Rs 96.18 crore.

In a letter to the textiles ministry, Sanjay Kajaria, chairman of the Indian Jute Mills Association, said that the move to waive import duties on raw jute and jute products would not only hit the growers and the mills, but also have some quality consequences vis-à-vis the packing of foodgrains.

Bags used in the packing of foodgrains have a coating of batching oil according to a pre-specified norm (three per cent batching oil content).

There is a possibility that this limit may be breached in imported bags, Kajaria said.