The Telegraph
Saturday , June 28 , 2014
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130 years on, a jute contest takes shape

Calcutta, June 27: The Indian Jute Mills Association (IJMA), one of the oldest trade bodies in the country, is ending a 130-year-old consensual tradition and setting the stage for a contest next week to elect its chairman and committee members.

The annual general meeting, scheduled for July 4, is being held at a time the jute industry is passing through one of its worst phases marked by the lynching of a chief executive of a mill in Hooghly this month.

The contest has been necessitated as Sanjay Kajaria, a former chairman of the association, has filed his nomination to contest against the incumbent, Raghavendra Gupta. Kajaria had started circulating an appeal among the association’s 33 members, highlighting the need for a change at the helm.

“For the past few years, we have miserably failed to convince the central and state government on every single issue. We have been attacked from all sides and our enemies have been successful in surrounding and killing us,” Kajaria has written in his appeal.

The contents of the letter make it apparent that the association — set up by the Scots and the English and later steered by Indian industrialists like M.P. Birla, R.P. Goenka and Hari Shankar Singhania — is developing cracks from within.

Gupta, the incumbent, projected a united front. “The industry is going through a bad phase but we are all together,” he said over phone from Delhi.

But industry insiders said all was not well within the jute family — and pointed to the murder of H.K. Maheshwari, the president and chief of operations at Northbrook Jute, by some workers.

“While investigating what went wrong in Northbrook, government agencies have learnt about various unfair trade practices that resulted in discontent among the workers. The credibility of the jute industry is at its lowest ebb,” said an owner of several jute mills in Bengal.

An issue that appears to be vexing the industry is a suspicion that some companies are using parts of the mill land for real estate development.

“It is unfortunate that real estate ventures have come up on some mill premises in violation of rules that prohibit change of character of the land,” said a source.

He added that gains from such projects were rarely ploughed back into the jute operations, deepening the resentment of workers who feel that they are being used as a façade while the owners reap the realty dividends.

Other allegations range from import of cheap jute bags from Bangladesh and selling them to Indian government agencies and non-payment of provident fund and other statutory dues to the workers.

“There is a huge trust deficit within government circles against the industry and its leaders,” Kajaria has written in his letter, urging the members to vote for him so that he can clear the air and convince the state and the Centre of the need for measures to revive the industry.

One of the key demands of the jute industry is the use of more jute bags for packing potatoes and rice. The bags are now primarily used to pack grain and sugar – but the mandatory order has been reduced from 100 per cent to 90 per cent. The industry wants the quota to be restored to 100 per cent.

Kajaria is telling the IJMA voters that he would also push the Centre to increase the use of jute sacks in place of bags made of variants of plastic.

But few seem to be trying to address the bigger question of how long an industry can survive solely on a government diet.

“It is true that mandatory packaging can save the industry for some time but in the longer run, the industry needs to develop markets on its own through research and development and marketing of its products other than sacks…. The idea behind the mandatory packaging order was to provide temporary support till they develop the market but they want it to be in perpetuity and that explains the state of the industry,” said a textiles ministry official in New Delhi.

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