Budget Provision Hike For Jute Corporation Urged

The Union textile minister, R L Jalappa, has made a proposal to the finance minister P Chidambaram to enhance the budget provision for Jute Corporation of India (JCI) from Rs 15 crore to Rs 25 crore.

In a letter to the finance minister, Jalappa pointed out that the budget provision for JCI was Rs 6 crore and it has been enhanced to Rs 15 crore.

However, annual requirement for payment of wages and salaries including bonus is of Rs 25 crore.

He requested the finance minister to consider the increase of budgetary provisions from Rs 15 crore to Rs 25 crore so that the wages and salaries could be paid.

"JCI has protected jute growers from distress sale", said D K Guha, vice chairman, Concern for Public Sector (CPS). He felt its paid up capital,now at Rs 5 crore, should be hiked.

Then JCI can utilise the capital return and strengthen the financial base of the organisation.

JCI has procured 4.4 lakh quintals of raw jute till date. Most of its 208 departmental purchase centres (DPCs) are now operative.

So far, the government has granted Rs 40-crore loan and also a guarantee for State Bank of India's cash credit to the tune of Rs 33 crore to JCI.

The basic feature of JCI's minimum support price (MSP) operation is buying raw jute irrespective of the grades - a move that safeguards the interest of jute growers and maintain buffer stock.

But JCI is facing a severe cash crisis as it is yet to receive about Rs 64 crore from the National Jute Manufacturers Corporation (NJMC) against raw jute supplied by JCI.

Subsidy from the government to the tune of Rs 61 crore is also pending for the MSP operations prior to the last five years.

The budget provision was Rs 6 crore and it has been enhanced to Rs 15 crore. However, annual requirement for payment of wages and salaries including bonus is of Rs 25 crore. R L Jalappa Union minister for textiles