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The jute mills have expressed serious concern over the proposed new pricing formulae of jute bags from September.
"There had been a meeting with the joint secretary of the Union Textile Ministry and Jute Commissioner, A Madhukumar Reddy with the Indian Jute Mills Association (IJMA) where the association raised serious concerns over the new pricing formulae adopted by the Tariff Commission 2017," industry sources told PTI.
Under the new pricing formulae devised by the Tariff Commission it will bring down prices of the jute bags supplied to the government by minimum 10 per cent.
The IJMA claimed that if the new pricing formulae was implemented from September several mills would have to close down as the mills would be "unviable" and the industry would collapse.
The IJMA had highlighted the inconsistencies to the Textile ministry and Jute commissioner.
The association also raised the concerns with the West Bengal Labour Minister Moloy Ghatak and sought the state government's intervention in the matter stating that the issue was serious.
Ghatak did not respond to calls for his reaction and state's plan to tackle the issue.
In West Bengal the jute mills directly employ over 2.5 lakh people and three to five lakh farmers are engaged with the industry.
The IJMA raised various issues with several heads considered for computation of the new pricing adopted by the Traiff Commission.
West Bengal accounts for more than 80 per cent of the jute production of the country.