Grain and sugar procurement during the kharif
season is set to suffer because of insufficient jute
Commissioner’s office is yet to update its Jute
Smart portal and make it compliant with the goods and services tax (GST). According to the Jute
Packaging Materials Act, 1987, 90 per cent of grain must be packed in jute
sacking. For sugar, the proportion is 20 per cent.
Punjab has warned the office of the Jute
Commissioner that the situation may spin out of control if urgent steps are not taken to make the jute
ready. In two letters to the Jute
Commissioner's office on July 4 and July 10, the Punjab government warned kharif
procurement would suffer due to jute
sacking. The Punjab government has placed an order for 2.2 million bales (one bale is 180 kg) of jute
bags for packing grain and sugar.
Commissioner could was not available for comments.
Punjab on July 3 noticed on the Jute
Smart portal that 0-36 per cent bales of jute
bags had been despatched to the state from 14 mills. The state government has sought a change of bag supply orders from non-performing to performing mills. It will review the supply position after July 25.
The situation is the fallout of an unbilled amount of Rs 450 crore. Each of the 70 mills in West Bengal, the biggest raw jute
producer, has an average unbilled amount of Rs 6 crore.
“Before introduction of the GST, the Jute
Commissioner’s office had issued a notification stopping despatches or accepting bills beyond June 27. Then, a meeting was convened between the Indian Jute
Mills Association (IJMA) and the Jute
Commissioner’s office. Though despatches resumed after July 3, payments could not be released due to problems with the Jute
Smart portal,” said the owner of a jute
From July 1, 5 per cent GST
has been levied on jute
products. The previous 1 per cent cess contributed by the industry now stands withdrawn. Jute
bags are supplied through the railways, Container Corporation of India (Concor) and by road. The industry is demanding jute
products be declared among the “specified category” to get relief from government challans.
Each day, the jute
industry manufactures 10,000 bales of jute
bags. Seventy per cent of this production is purchased by the government. All purchases used to be carried out through the Jute