Textiles Min to examine issue of stock restriction for jute exports: Goyal

The Ministry of Textiles believes that raw jute is being hoarded leading to a crisis in the sector, but will examine if some relaxations could be offered on stock limit for export orders, Union minister Piyush Goyal said on Friday.

The assurance from the Union textiles minister came at a time when the Indian Jute Mills Association (IJMA) has initiated legal steps against the government for a resolution to the raw jute crisis which leads to financial losses for the millers and supply commitment failure.

The regulator, Jute Commissioner, has imposed a price cap of Rs 6500 per quintal on raw jute and a stock limit of a maximum of 45 days.

During a virtual interaction with the members of Merchant's Chamber of Commerce and Industry (MCCI), Goyal said the government cannot offer support to the jute sector by way of mandatory packaging and continues to pay higher prices due to hoarding.

We will get it examined with the Jute Commissioner and see if stock relaxation can be offered for exports, he replied to a question on the current restriction by the regulator to stock raw jute by a mill to a maximum of 45 days.

The minister also sought suggestions for reforms in the jute sector to protect the interest of farmers.

"We have long term export commitments for a period between six and 12 months, while a stock limit of just 45 days results in financial risk, Fort Gloster MD Hemant Bangur said.

Sources said that IJMA has moved court against the government over the raw jute price capping.

Meanwhile, MCCI members lauded Goyal, also the Union commerce and industry minister, for calling up State Bank of India during the interaction to solve a problem of tea gardens in Assam - there are only 100 ATMs for around 800 gardens.

The minister assured them that their problem of cash handling will be resolved.

He said he will look into the inverted duty structure for fragrance industry and gems and jewellery sector.

He sought ideas from the industry in finalising trade treaties with various countries that are either underway or will come up soon.

Bilateral free trade agreements are being negotiated with the United Arab Emirates, the United Kingdom, Australia and Canada, while dialogue has started with Israel.

Goyal said trade treaties are two-way paths but the government will strike a balance to protect the interest of all stakeholders.