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Bangladesh should move for diversified jute goods to tackle corona impact

Introduction

The Novel Coronavirus is now a terrific name for us. Due to the outbreak of the Coronavirus, the economic condition of our country is gradually declining. In this situation, we can diversify our export items by making jute made domestic products. Jute is known as the ‘Golden Fiber’ of Bangladesh due to its golden-brown color and its importance. In terms of usage, production and global consumption, jute is second only to cotton, which is one of the major cash crops in Bangladesh.

Bangladesh-should-diversify-jute-goods
Figure 1: Jute is known as the ‘Golden Fiber’ of Bangladesh due to its golden-brown color and its importance. Courtesy: Xinhua/Salim Rezas

Better and diversified use of jute can ultimately contribute to the overall economy as it has the highest scope for value addition.

Coronavirus and global economic disruption

The consequence of this is a retard of the ‘Global Manufactory’ due to the coronavirus outbreak. Chinese goods make up more than 26 percent of Bangladesh’s total imports. The country’s economy is now likely to face an adverse impact because it maintains close commercial relations with China. “From an economic perspective, the key issue is not just the number of cases of COVID-19, but the level of disruption to economies from containment measures,” Ben May, Head of Global Macro Research at Oxford Economics, said in a report.

“Widespread lockdowns such as those imposed by China have been enacted in some virus hotspots,” he said, adding that such measures — if taken disproportionately — could induce panic and weaken the global economy even more. Fears of the coronavirus impact on the global economy have rocked markets worldwide, plunging stock prices and bond yields.

When we talk about Bangladesh’s economy in the global business, the first thing that comes to our minds is our Ready-Made garments (RMG) industry, which is the biggest export-earning sector – contributing over 84 percent to the country’s annual export. This sector has started to witness its share of loss due to the coronavirus outbreak globally.

Bangladesh Garments Manufacturers and Exporters Association (BGMEA) has faced order cancellation amounting to 3.18 billion by the top international clothing retailers and brands. As a result, industry insiders are expecting further cancellation and slashing of work orders in the foreseeable future as the world spanners with escalating numbers of infected cases and mortality rates due to this fatal virus.

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Figure 2: Production and processing of jute fiber is easier and less costly than other fibers.

How can jute fiber tackle the corona effect?

For the coronavirus outbreak, Bangladesh textile and apparel industry is suffering a lot and it reveals how dependent we are on foreign buyers and raw materials. At this time the jute sector can be a hope for us. Jute is our raw material which can help us to make a self-reliant industry utilizing our labor and resources.

Production and processing of jute fiber is easier and less costly than other fibers. There is no need to import raw materials from overseas to manufacturing the jute products; as a result, it will be easy to reduce the cost of import by making and marketing of domestic products from jute fiber.

Some facts related to the jute sector

  • In 2002, the government closed down Adamjee Jute Mills, the largest jute mill in Bangladesh.
  • In 2010, the Government of Bangladesh made it mandatory for wholesale manufacturers and sellers to pack rice, sugar, wheat, and fertilizers in jute bags.
  • In 2018, Bangladesh Jute Mills Corporation recommended the Ministry of Jute and Textiles form a 100 billion BDT fund, to develop the jute industry and provide low-cost loans.
  • In January 2018, the Government of Bangladesh imposed a ban on the export of raw/unprocessed jute to ensure adequate supply for the local market.
  • The export ban was lifted in June 2019 following the demands of the Bangladesh Jute Association.
  • From 2010 to 2019, the Government of Bangladesh has given to about 7.5 billion takas to the Bangladesh Jute Mills Corporation. The corporation has not been able to turn a profit, and it has been experiencing losses every year since 1980 except the 2010-11 fiscal year.
  • In 2019, India expanded anti-dumping tariffs by imposing US$125.21 on per ton of jute sacks, which led to concerns being expressed by Bangladesh Jute Mills Association as India is a major destination for Bangladeshi jute.
  • Janata Jute Mills and Akij Jute Mills are the two largest private jute mills in Bangladesh.

Prospects of jute fiber

At present Bangladesh is the second-largest producer of jute, India being the largest one. But Bangladesh produces the finest quality of jute due to favorable climate and soil conditions. Although the jute sector is striving for its existence with a huge accumulated financial impose on it and losses being incurred every year. As an eco-friendly, biodegradable, easily disposable and natural commodity, there are various good prospects of Jute fiber and Jute products.

Better and diversified use of jute can ultimately contribute to the overall economy as it has the highest scope for value addition.

Below facts have created opportunities for the jute sector to boom:

  • Artificial fibers and synthetic products, which are now being replaced by the environment-friendly jute goods.
  • The Govt. of Bangladesh banned production, sale and use of polythene from 01 March 2002. As a result, the demand for Jute and Jute goods is increasing.
  • There is a huge local demand for jute stick as a primary substitute for diesel/wood.
  • Due to the increasing price of Jute and Jute goods more entrepreneurs (SMEs) are entering the market for Jute business and introducing new Jute Diversified Products.
  • The first and foremost strength of the Bangladesh Jute Industry is that it is based on the raw material that is available at the doorstep. Moreover, the quality of the raw material is the best available in the world. Bangladesh is the natural abode of jute cultivation on account of its climatic situation and soil condition.
  • There are educated and professionally experienced people in the country to run industries including jute industries.
  • Bangladesh jute industry is based on old technology and machinery. New technologies for the production of diversified jute products are now available.
  • Jute is one of the most versatile natural fibers used as raw material for packaging, textiles, the non-textile and agricultural sectors.

Uses of jute fiber in various purposes

Jute is a fantastic fiber and its applications and benefits can be unceasing. Besides the wildly popular jute burlap gift bags and shopping bag, tote bags, and more; we can use jute for various other purposes as well as – bailing and bundle clothes, different types of ropes, twines, and strings, Clothes, home furnishing, and fashion accessories.

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Figure 3: Jute carpets in Exhibition. Courtesy: Xinhua

Demand for jute clothes increasing day by day, but not the coarse type. We can separate jute threads into very thin and refined threads that are similar to silk. Jute fiber is also used for making Tapestries, soft luggage, decorations, baskets, storage solutions, chair coverings, carpets, area rugs, hessian cloth, and backing for linoleum, Outdoor furniture, etc.

Conclusion

We still have time to introduce diversified jute products to the world market. After making, using and exporting jute fiber and products, we can move forward with the slogan, “Using domestic products and enrich the country and the nation”.

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