Declaration

I, Aryan Chaudhary, a student of Master of Business Administration, at Vivek College, hereby declare
that the mini-project report titled "Jute Industry" submitted to “Vivek College of Management &
Technology” is a record of my original work, carried out during the academic term [2st Semester, 1st
year].

This project report has been prepared as part of the academic requirements under the guidance of Mr.
Narpendra kumar Sharma Sir. I have undertaken this project independently, and any content, data, or
insights derived from external sources, such as publications, research papers, or online articles, have
been properly acknowledged and cited in the report.

I affirm that this report has not been submitted, either wholly or in part, for any other examination,
evaluation, or academic program at this or any other institution.

I understand that any violation of the rules regarding plagiarism, misrepresentation of data, or
falsification of information will lead to disciplinary action as per the guidelines of Vivek College of
Management & Technology.

Signature:
Name: Aryan Chaudhary
Date:
 Acknowledgement

I would like to express my sincere gratitude to everyone who has supported and guided me throughout
the course of this mini-project on "Jute Industry".

First and foremost, I am deeply grateful to Mr. Narpendra Kumar Sharma Sir, my project Coordinator,
for their invaluable guidance, encouragement, and insightful feedback, which were crucial in completing
this project.

I would also like to extend my heartfelt thanks to “Vivek College of Management & Technology” for
providing the resources and infrastructure necessary to carry out this project. The support from faculty
and staff members of the Department of Master of Business Administration has been instrumental in
my learning and progress.

Special thanks go to my classmates and friends for their constant encouragement, and to my family,
whose support and understanding have been a source of strength throughout this project journey.

Finally, I am grateful to all authors, researchers, and industry experts whose work has inspired and
contributed to the knowledge shared in this report.

Thank you all for your invaluable support and contribution.

Name: Aryan Chaudhary

Date:
 Preface
The primary objective is to provide a comprehensive analysis of the jute industry, focusing on its current status,
challenges, and future prospects. The study encompasses various facets of the industry, including production,
processing, marketing, and export dynamics.

The jute industry holds significant importance in India's economy, particularly in states like West Bengal, Bihar,
Assam, Odisha, and Andhra Pradesh. Despite facing challenges such as competition from synthetic alternatives
and outdated technology, the industry continues to be a major source of employment and export revenue.
Recent initiatives aimed at promoting eco-friendly products have opened new avenues for the revival and
growth of this sector.

The insights and data presented in this report are derived from a combination of primary research, including
interviews with industry stakeholders, and secondary sources such as academic journals, industry reports, and
government publications. The analysis aims to offer strategic recommendations for enhancing the
competitiveness and sustainability of the jute industry in the global market.
 TABLE OF CONTENTS

1. Introduction--------------------------------------------------------------------------------------------------

2. Current Profile of the Industry--------------------------------------------------------------------------

3. Major Market Players of the Industry-----------------------------------------------------------------

4. SWOT Analysis-----------------------------------------------------------------------------------------------

5. Issues and Challenges of the Industry-----------------------------------------------------------------

6. Importance of Artificial Intelligence in Industry----------------------------------------------------

7. Application of Emerging Technologies----------------------------------------------------------------

8. Limitations of Latest Technology-----------------------------------------------------------------------

9. Conclusion----------------------------------------------------------------------------------------------------

10. References-------------------------------------------------------------------------------------------------
 Introduction

Jute—often called the “golden fibre”—continues to play a pivotal role in India’s agriculture and
industrial sectors. Cultivated primarily in West Bengal, Bihar, Assam, Odisha, and Andhra Pradesh, it is
the backbone of around 4 million rural families. With cultivation spanning approximately 662,000
hectares and production reaching 1.247 million metric tonnes in FY 2022–23, India remains the world’s
leading producer of jute goods—accounting for roughly 75 % of global output—and is the third-largest
exporter.

Economic and Employment Significance

 The sector supports around 400,000 jute mill workers and another 400,000 smallholder farmers
.

 In FY 2022–23, India exported US $471.8 million worth of jute products, including diversified
items like carpets and decorative fabrics.

Product Portfolio and Market Dynamics

Jute’s application spectrum spans traditional sacks, hessian cloth, ropes, and carpets to emerging
products such as geotextiles, bio-composites, and fashion accessories

 The global natural-fiber geotextiles market, including jute-based solutions, is valued at

US $7.36 billion (2023) and projected to grow 6.7 % annually through 2030
  Meanwhile, the global jute fiber market is expected to expand from US $3.18 billion in 2024 to
US $3.9 billion by 2032, supported by interest in biodegradable materials.

Challenges and Government Push

Despite its prospects, the jute sector faces hurdles like climatic dependency, inconsistent quality, and
stiff competition from cheaper synthetics like polypropylene

 Nevertheless, India’s government continues enforcing reservation orders—mandating 100 % of

food grains and 20 % of sugar be packed in jute bags, despite industry resistance and legal
disputes over hygiene and cost concerns.

Technological Innovation and Market Evolution

Ongoing modernization and product diversification efforts are gaining traction:

 Skill development initiatives, such as the 7-week program in Kerala, aim to boost artisanal
quality .

 Research into nano-engineered composites shows jute reinforced with graphene can enhance
tensile strength by over 100 %.
HISTORY OF JUTE INDUSTRY

Indian Jute Industry

The jute industry occupies an important place in the Indian economy. Providing direct employment to about
0.26 million workers and around 4.0 million workers indirectly in the allied sectors, Indian jute industry is an
integral part of the Indian Textile Industry. It is a very old industry, predominant in the eastern part of India. The
Government has included the Jute Sector for special attention in its National Common Minimum Programme.

Jute Technology Mission

The Government of India has started the "Jute Technology Mission" keeping in view the growing contribution of
the industry to the economy. This will benefit jute growers, the workers engaged in the sector, jute
entrepreneurs and others employed in related activities. It will play a vital role in modernizing the jute industry
and help the country to reap the benefits of enhanced levels of jute diversification.

Jute Mills

Jute mills comprising the industry are located in West Bengal (the maximum number of mills is here), Andhra
Pradesh, Assam, Orissa, Uttar Pradesh, Bihar, Tripura and Chhattisgarh. India has around 78 jute mills and the
eastern state of West Bengal alone has around 61 jute mills. The central government owns 6 jute mills, the state
government 4, 2 jute mills are under cooperatives, and 64 jute mills are under private ownerships.

Earnings

This industry today accounts for a turnover of Rs 6,500 crore annually, contributing to exports to the tune of
nearly Rs.1000 crore. In the financial year 2006-07 (April- September) exports of total jute products was at 104.3
thousand M.T whose value was Rs.

583.55 crore.
Organizations

Organizations which control the Indian Jute Industry are as follows:

 National Centre for Jute diversification, Kolkata

 Jute Manufacturers Development Council, Kolkata

 National Jute Manufacturers Corporation

 Jute Corporation of India Ltd., Kolkata

 Birds jute & Exports Ltd.

 Institute of Jute technology, Kolkata

 Indian Jute Industries Research Association, Kolkata

Acts and Rules

The various Acts and Rules which govern the Indian Jute Industry are as follows:

 Jute & Jute Textiles Control Order, 2000

 Jute Packaging Materials (Compulsory use in Packing Commodities), Act, 1987

 Jute Manufactures Cess Act, 1983

 Jute Manufactures Development Council Act, 1983

Advantages of Indian Jute Industry

 Largest production of raw jute in the world

 Largest production of jute finished goods

 Environment friendly packaging material

 Availability of large scale skilled and cheap labor

 Availability of entrepreneurial skills

 Huge export potential of jute products

 Large domestic market

 Flexible textile manufacturing systems

Demerits of Indian Jute Industry

 Imports of cheap and alternative textiles from other Asian countries

 Use of old methods of manufacturing

 Poor supply chain management

 Huge decentralized and unorganized sector

 High production cost

 Current Profile Of The Industry

1. Production & Cultivation

 Scale & output: In FY24–25, jute cultivation in India fell by approximately 20% due to
devastating floods in West Bengal and Assam impacting crop yield .

 Cultivation area: About 662,000 ha under cultivation produced 1.246–1.247 million MT in FY22–
23, with ~70–75% of global output attributed to India .

 Regional purposes: Major jute-growing states include West Bengal (~80%), Assam, Bihar,
Odisha, and Meghalaya.
2. Infrastructure & Labor

 Milling capacity: India operates ~80 active jute mills (concentrated in the Hooghly–Howrah
belt), with roughly 50 million spindles and 842,000 rotors

 Employment: The sector supports around 400,000 mill workers directly and another 400,000
farmers, impacting at least 4 million rural households
3. Domestic Consumption & Trade
 Domestic usage: About 90% of jute output is consumed locally, driven by the mandatory use of
jute bags for 100% of food grains and 20% of sugar packaging .

 Exports: Exports reached about US $471.8 million in FY22–23. Key products include hessian,
sacking, yarn, carpet backing cloth (CBC), and diversified goods, going to markets like the USA,
UK, France, Netherlands, Spain, Germany, and Australia.
4. Institutional Framework & Support
 Price support: The Jute Corporation of India (JCI), under the Ministry of Textiles, procures raw
jute at MSP (₹5,335/quintal in 2024–25) to stabilize farmer incomes

 Development programs: The National Jute Board administers initiatives like ICARE, JRCPC, PLI,
CSAPM, EMPA, and MDPS, focusing on agronomy, machinery modernization, marketing, and
product innovation

5. Key Opportunities & Innovation

 Product diversification: Jute is being reimagined beyond sacks—into geotextiles, composites
(including graphene-enhanced jute), home décor, fashion, and sustainable packaging—driven
by global eco-conscious trends .

 Export potential: Diverse products like shopping and gift bags, decorative fabrics, and CBC are
on the rise; exports to the U.S. alone totaled US $107 million in FY21–22 .

6. Challenges
 Production volatility: FY24–25 saw a ~20% drop in output due to floods, impacting farmers and
supply stability.

 Quality and yield issues: Average yield in India lags (~1.3 t/ha) compared to Bangladesh
(~1.6 t/ha); over 80% of raw jute quality is considered mediocre or poor due to suboptimal
retting, seed quality, and infrastructure .

 Technological constraints: Low capacity utilization (~50–80%) and reliance on outdated

machinery inhibit productivity and modern product development .

 Regulatory disputes: Sugar industry legal resistance to the 20% mandating of jute bags claims
additional costs (~US $76 million/year) and hygiene concerns; court rulings awaited.

 Competitive threats: Competitive pricing from synthetics and Bangladeshi jute imports
challenges domestic demand and profitability .
7. Outlook & Strategic Implications
 Sustainability tailwinds: Rising bans on plastics and sustainability initiatives make jute a
compelling alternative—its usage is increasing in packaging and textile sectors.

 Growth trajectory: Diversified and value-added jute segments (bags, CBC, composites) show
significant mid-term potential, provided India invests in quality, branding, and modernization.

 Policy-direction: MSP enhancements, modernization subsidies, mandatory packaging

enforcement, and PLI schemes will shape industry direction in FY25–26. Monitor court rulings
and committee reviews closely.
 Major Market Players of the Industry

Gloster Jute Mills Ltd

PROFILE

Gloster Jute Mills Ltd is a Public Company having its registered office at 21 Strand Road Kolkata 700
001 incorporated on 18th February [Link] is a professionally managed company engaged in the
manufacture of Jute & Jute allied products. The factory is situated at Bauria, P.O. Fort Gloster, Dist.
Howrah. The present management has an experience of over 50 years in running large jute
manufacturing units. The unit has extensively been modernized to produce value added diversified
jute products like floor covering, geo-textiles, processed decorative and industrial fabrics, Food grade
quality jute cloth and bags apart from traditional jute products including yarn/twin.

Gloster Jute Mills is one of the few ISO Certified Companies in the jute industry. It is one of the fast
growing Jute manufacturing & exporting company and is a Recognized Export House.

The company presently has two business units along with one Captive Power Plant (CPP) which is
used as standby situated in the district of Howrah. The Domestic Tariff Area unit is in operation since
1890 and was taken over by the Bangur Group in the year 1954. A 100% Export Oriented Unit (EOU)
started its commercial production in jute industry
Profit loss account

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Income

Operating income 169.15 159.57 130.05 136.98 122.94

Expenses

Material consumed 91.63 77.21 74.57 79.06 68.79

Manufacturing expenses 9.42 11.59 8.76 9.89 5.89

Personnel expenses 33.28 33.85 23.43 26.16 1.21

Selling expenses - 4.25 3.38 3.68 0.73

Adminstrative expenses 14.64 6.40 6.02 5.57 36.31

Expenses capitalized - - - - -

Cost of sales 148.98 133.30 116.15 124.37 112.93

Operating profit 20.17 26.26 13.90 12.62 10.01

Other recurring income 2.47 0.20 0.19 0.20 3.21

Adjusted PBDIT 22.64 26.47 14.09 12.81 13.22

Financial expenses 2.67 3.31 4.32 3.62 2.75

Depreciation 5.11 5.12 4.51 3.64 2.96

Other write offs - - - - -

Adjusted PBT 14.86 18.04 5.26 5.55 7.51

Tax charges 5.78 6.70 1.97 2.02 3.46

Adjusted PAT 9.08 11.33 3.29 3.54 4.05

 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Non recurring items - -0.51 0.39 0.46 -

Other non cash adjustments - 0.21 0.55 0.37 -

Reported net profit 9.08 11.04 4.23 4.36 4.05

Earnigs before appropriation 11.20 12.89 5.97 5.83 4.99

Equity dividend 1.31 0.65 0.52 0.52 0.46

Preference dividend - - - - -

Dividend tax 0.22 0.11 0.09 0.07 0.06

Retained earnings 9.67 12.12 5.35 5.23 4.47

Balance sheet

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Sources of funds

Owner's fund

Equity share capital 2.62 1.31 1.31 1.31 1.31

Share application money - - - - -

Preference share capital - - - - -

Reserves & surplus 48.75 42.51 32.40 27.28 23.51

Loan funds

Secured loans 30.33 25.26 22.93 25.38 23.81

Unsecured loans - 5.77 12.22 11.35 6.95

Total 81.69 74.84 68.86 65.31 55.58

Uses of funds

Fixed assets

Gross block 86.43 79.95 74.49 62.32 54.98

Less : revaluation reserve - - - - -

Less : accumulated depreciation 29.94 24.96 19.92 15.51 11.93

Net block 56.49 54.99 54.57 46.81 43.05

Capital work-in-progress 1.00 2.55 1.30 5.10 0.78

Investments 0.35 0.35 0.15 0.15 1.60

Net current assets

Current assets, loans & advances 50.50 42.18 29.91 29.07 24.39

Less : current liabilities & provisions 26.66 25.23 17.07 15.97 14.52

Total net current assets 23.84 16.95 12.84 13.10 9.86

Miscellaneous expenses not written - - - 0.14 0.29

Total 81.69 74.84 68.86 65.31 55.58

Notes:

Book value of unquoted investments 0.20 0.20 - - -

Market value of quoted investments 0.15 0.15 0.15 0.15 1.14

Contingent liabilities 5.84 6.51 4.87 4.26 -

Number of equity sharesoutstanding (Lacs) 26.17 13.08 13.08 13.08 13.08

INTERPRETATION: The net profit of GLOSTER JUTE MIL LTD COMPANY to is increased to 5.29 in 2009 as
comparing to previous year. company growth is high comparing to previous year

Ratios

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Per share ratios

Adjusted EPS (Rs) 34.70 86.64 25.13 27.03 30.94

Adjusted cash EPS (Rs) 54.22 125.80 59.59 54.83 53.53

Reported EPS (Rs) 34.70 84.34 32.35 33.35 30.94

Reported cash EPS (Rs) 54.22 123.51 66.81 61.16 53.53

Dividend per share 5.00 5.00 4.00 4.00 3.50

Operating profit per share (Rs) 77.08 200.75 106.22 96.42 76.54

Book value (excl rev res) per - 334.88 257.63 217.39 187.49
share (Rs)

Book value (incl rev res) per - 334.88 257.63 217.39 187.49
share (Rs.)

Net operating income per 646.42 1,219.61 994.00 1,046.99 939.64

share (Rs)

Free reserves per share (Rs) - 313.42 236.16 207.39 -2.21

Profitability ratios

Operating margin (%) 11.92 16.45 10.68 9.20 8.14

Gross profit margin (%) 8.90 13.24 7.21 6.55 5.74

Net profit margin (%) 5.29 6.90 3.25 3.18 3.20

Adjusted cash margin (%) 8.26 10.30 5.98 5.22 5.55

Adjusted return on net worth 17.67 25.87 9.75 12.43 16.50
(%)

Reported return on net worth 17.67 25.18 12.55 15.34 16.50

(%)

Return on long term funds (%) 21.46 34.38 16.36 21.80 18.46

Leverage ratios

Long term debt / Equity 0.59 0.41 0.73 0.47 1.24

Total debt/equity 0.59 0.70 1.04 1.28 1.24

Owners fund as % of total 62.87 58.54 48.94 43.76 44.65

source

Fixed assets turnover ratio 1.96 2.00 1.75 2.20 2.24

Liquidity ratios

Current ratio 1.89 1.67 1.75 1.82 1.68

Current ratio (inc. st loans) 1.89 0.83 0.79 0.56 1.68

Quick ratio 0.58 0.63 0.67 0.49 0.52

Inventory turnover ratio 4.84 6.80 8.75 7.37 7.33

Payout ratios

Dividend payout ratio (net 16.85 6.93 14.46 13.67 12.89

profit)

Dividend payout ratio (cash 10.78 4.73 7.00 7.45 7.45

profit)

Earning retention ratio 83.15 93.25 81.38 83.13 87.11

Cash earnings retention ratio 89.22 95.36 92.15 91.69 92.55

Coverage ratios

Adjusted cash flow time total 2.14 1.89 4.51 5.12 4.39
debt
Financial charges coverage 8.47 8.00 3.26 3.54 4.80
ratio

Fin. charges [Link] (post tax) 6.31 5.89 3.02 3.21 3.54

Component ratios

Material cost component (% 56.72 51.83 53.17 61.51 55.00

earnings)

Selling cost Component - 2.66 2.59 2.68 0.59

Exports as percent of total 22.61 20.65 19.60 18.70 -

sales

Import comp. in raw mat. 3.36 9.79 35.81 14.23 -

Consumed

Long term assets / total Assets 0.53 0.57 0.65 0.64 0.65
 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Bonus component in equity 75.00 50.00 50.00 50.00 50.00

capital (%)
JANATA JUTE MILL Ltd PROFILE

Janata Jute Mills Ltd., is a public limited company, which was established in the year 1966, in the wake of
Bengali nationalism. The factory is located in Polash, Ghorashal in the district of Narsingdi. It is situated on the
bank of river Sita-Lakshya, which is about 45 km. north-east of Dhaka city on the Dhaka-Sylhet highway covering
an area of 50acres of land.

The factory’s trial production commenced in 1968 and commercial production in [Link] unit had an installed
capacity of 150 Hessian and 100 sacking looms primarily weaving to produce and export Hessian cloth and
sacking bags having annual weaving production capacity of 9,000 tons per annum.

After the emergence of Bangladesh, government’s policy towards socialism it was nationalised in May, 1972. For
long ten years it was under government management. But in 1982 the then government took a bold decision to
denationalise the jute mills which were 100% owned by Bangladeshis. So Janata Jute Mill Ltd, was handed over
to its original Bangladeshi owners on 10th, January 1983.

After denationalization, the company immediately went into expansion by adding 18 Hessian looms under its
expansion plan. But due to change in the global economic scenario and closing down of the jute spinning in
Europe, the company took the opportunity to import second-hand jute mill machinery for producing jute yarn
for the carpet industries in Europe. This is how the jute yarn manufacturing section came into existence.

The first yarn unit started production in 1986 with 16 spinning frames and a production capacity of 12 tons per
day of specialized jute yarn for the carpet industries. The unit had the capacity to manufacture jute yarn from
3.5 lbs. (8.2nm) to 16 lbs (1.8nm) of 1 to 3 plies for specialized carpet industries.
Regulatory & Price-Support Bodies

 Jute Corporation of India (JCI): A central PSU under the Ministry of Textiles, JCI plays a critical role in
procuring raw jute at the Minimum Support Price (₹5,335/quintal for 2024–25), stabilizing farmers'
incomes and safeguarding against exploitative trading
[Link]+[Link]+[Link]+11.

Public Sector Undertakings & Nationalized Mills

 National Jute Manufacturers Corporation Ltd (NJMC): Originally overseen six nationalized mills in West
Bengal and Bihar; currently, only three units remain operational (North 24 Parganas and Katihar). The
rest have been closed [Link].

Large-Scale Mill Operators (Private & Publicly Listed)

Key industrial leaders driving bulk jute production and exports, mostly located in the Hooghly–Howrah belt:

 AI Champdany Industries Ltd: Established in 1917, one of India’s oldest jute entities; produces a wide
range of jute goods including sacks, hessian, and rugs [Link].

 Budge Budge Company Ltd (BBCL): Composite mill with annual capacity ~33,000 MT, 3,500 employees;
products include bags and cloth, marketed domestically and internationally
[Link]+[Link]+[Link]+4.

 Gloster Ltd: Operating since 1879, specializes in woven/non-woven geotextiles, treated fabrics, décor
and packaging solutions; two units in Howrah district [Link]+[Link]+1.

 Cheviot Company Ltd: Flagship mill producing technical jute fabrics and customized export-oriented
shopping bags; based in Falta SEZ [Link]+[Link]+[Link]+3.

 Ludlow Jute & Specialities Ltd: Known for value-added jute products like mesh, scrim, webbing, soil-
stabilizers; 45% of production is exported [Link]+[Link]+[Link]+10.

Niche & Emerging Specialist Firms

These companies focus on diversified jute-based products (bags, ropes, decorative items) and are gaining
traction amid growing eco-conscious demand:

 Premchand Jute & Industries Pvt Ltd

 Bangalore Fort Farms Ltd (BFFL)

Both based in West Bengal, manufacturing packaging, yarns, ropes, and specialized jute items
[Link]+[Link]+[Link]+7.
  Additional players include:

o Eco Jute Pvt Ltd

o Anand Jute Industries

o Lovson Exports

o Jaikishan Dass Mall Jute Products (JM Jute)

These firms focus on export-quality gift bags, geotextiles, and decorative cloth .

Industry Association & Trader Network

 Indian Jute Mills Association (IJMA): The apex industry body representing 37 composite mills. Key
members include Budge Budge, Cheviot, Ambica, Anglo India, Gloster, Ganges Manufacturing,
Kamarhatty, Premchand, Shaktigarh, RDB Textiles, among others. IJMA coordinates policy advocacy,
data consolidation, standards, and regulatory liaison .
 SWOT ANALYSIS

STRENTHS

 Jute is a labor intensive industry, which engages 4.35 million people.

 Jute industry has lot of potential of providing employment especially in East Indian region. The
industry offers employment opportunity to 7,500 persons per year, besides more opportunity lie
ahead in expansion of existing capacity in new mills that are coming up in SSI and MSI.

 Jute is an eco-friendly and biodegradable product. With the pressure from green movement, it is
going to sustain through consumer's preference.

WEAKNESS

 Frequent revision of PJMA guidelines (to add or dilute items for jute packing) leaves the industry in
confusion whether to invest further on the Jute technology development/product
development/market expansion or wait for new policies etc.

 Though jute industry is a labour intensive, wages represent 35% of total conversion cost of jute
industry, which evades the profit margins.

 Multi unionism is one of the major problems faced by jute industry and engages major concentration
of routine management in resolving labour dispute.

 The machinery used in jute industry is old and obsolete with age of machinery ranging between 40 -
150 years. They have lost their capacity to produce quality products and in spite of routine
maintenance, fail to yield standard machine production. In fact, the 150 years old industry with 75%
obsolete machinery is tagged as "Sunset industry" with "Vintage machinery". Though National Jute
Policy, 2005, aims at revamping the domestic jute industry through modernisation & by upgrading
technology, only a few mills could utilise the fund provided by Jute Manufacturers and Development
Council (JMDC) for modernising theirplant and machinery plant partly. Thus JMDC had to return
major part of the fund, ie, Rs 80 crores after using less than Rs 10 crores. The Government has ear-
marked Rs 75 lakhs per year per mill for capital investment in modernisation but industry feels it is
inadequate for an average mill and wants it to be raised to Rs 2 crore .
 Another weakness of jute industry is poor Research & Development (R&D) initiation,
invention/reverse engineering effort has been grossly neglected in this sector. The reasons for this
are lack of farsightedness & forward planning on the part of government and industry.

 Marketing has been another weak point of jute industry. It has been maintaining a very slow pace in
coming out of traditional way of marketing. Time has come for the industry to think how to market
this versatile, eco-friendly and natural fibre. Government can only give initiation in product
development and test marketing but the follow-up rests on the industry.

 Within the country, wage for workers varies from Rs 50 - Rs 250 per manday. Government must take
immediate steps in this concern and formulate need based wage structure for jute sector. While
doing so, there should be productivity linked payment. Payment by result is a universally accepted
phenomenon and accepted by ILO. Trade Unions in the jute sector agree on it but at plant level,
same unions resist, thereby causing labour productivity to be lower than standard.

 Indian jute has not been able to build brand image for jute that goes with the quality.
Opportunities (External Potential)

 Global shift to green products: Plastic bans worldwide and eco-driven demand open
significant opportunities for jute.

 Value-added growth: Rising demand for geotextiles, composites, designer bags, décor, and
high-end packaging .

 Policy push & modernization: Government incentives (ICARE, PLI, MSP support) encourage
industry upgrades.

 Tech integration: Potential use of AI/ML in quality control and supply chains, and biotech
advances like graphene composites .

Threats (External Risks)

 Synthetic competition: Low-cost PP sacks and composites threaten traditional jute uses.

 Bangladesh rivalry: Neighboring mills benefit from subsidies (~7% cash support) and
produce higher-quality fibre.

 Policy uncertainty: Shifts in mandatory packaging laws, frequent revisions to PJMA

guidelines, and potential dilution threaten predictability.

 Raw input volatility: Weather-induced yield fluctuations, seed quality issues, and market
price swings pose continual supply-side risk

30
 ISSUES AND CHALLENGES OF THE INDUSTRY

1. Raw Material Crisis & Price Volatility 🌾

 Frequent price spikes: As of May 2025, raw jute costs surged sharply, creating a
severe supply crunch. Industry expectations hinge on the Expert Committee on Jute
meeting (June 3) to address these pressures
[Link]+[Link]+[Link]+[Link]+1timesofind
[Link]+1.

 Procurement discrepancy: Despite an MSP of ₹4,750–₹5,335/quintal, farmers sell

raw jute to mills at ₹7,200/quintal due to middlemen involvement, technology gaps,
and the lack of direct procurement mechanisms
[Link]+[Link]+1.

 Supply disruptions due to climate: Floods, cyclones (e.g., Amphan), and COVID-19-
related interruptions have damaged crops and infrastructure, leading to supply
shortages and poor-quality harvests [Link].

2. Outdated Infrastructure & Labor Inefficiencies 🏭

 Obsolete technology: Up to 75% of mills still rely on machinery over 40 years old,
resulting in utilization rates of only 50–83% [Link].

 High labor costs & disruptions: Wages consume ~35% of conversion costs. Frequent
strikes and union unrest further undermine productivity .

 Power and utilities: Erratic power supply and poor infrastructure in mill regions add
to operational inefficiencies .

31
3. Food-Grade Demand Collapse & Policy Friction 📉

 Mandatory jute packaging faltering: While the JPMA mandates 100%

foodgrain and 20% sugar packaging in jute bags, non-compliance by
sugar mills and reverse auctions on the GeM portal have led to an
estimated 30% drop in demand for packaging bags in 2024–25
[Link]+[Link]+[Link]+6.

 Legal pushback: Sugar producers argue the mandatory rule costs an

extra US $76 million annually and poses hygiene risks; the dispute is
currently before the Karnataka High Court [Link].

4. International Competition & Synthetic Substitutes 🌍

 Bangladesh advantage: Superior machinery, better fiber quality, and

state subsidies give Bangladeshi producers a competitive edge in global
exports .

 Synthetic fiber substitution: Cheaper plastic and polypropylene products

continue to erode traditional jute-based markets .

5. Crop Yield, Quality & Supply Chain Flaws 🧪

 Low yields: Indian yields (~1.3 t/ha) lag behind Bangladesh (~1.6 t/ha),
compounded by poor retting practices, erratic water availability, and
lack of grading incentives for farmers [Link].

 Storage inefficiency: Inadequate warehousing leads to spoilage, post-

harvest losses, and seasonal price fluctuations .

32
6. Product Diversification & Branding Deficit 🎯
 Limited innovation: Despite potential in composites, geo-textiles, CBC, and green
packaging, Indian millers lag in diversification due to policy protection, risk aversion,
and lack of R&D.

 Weak branding: India's jute products suffer from poor international visibility and
marketing, especially compared to synthetic or Bangladeshi alternatives .

7. Financial Stress & Delayed Pricing Reform 💵

 Unsustainable pricing formula: Revisions to price benchmarks for government-
supplied jute goods from 2016 have been delayed, costing mills an estimated ₹1,500
crore and delaying critical modernization investments [Link].

 GeM discount pressure: Reverse auctions on government e-market platforms are

driving prices below cost levels, straining mill finances and jeopardizing wages and
statutory obligations

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 IMPORTANCE OF ARTIFICIAL INTELLIGENCE IN INDUSTRY

1. Precision Agriculture & Crop Monitoring

 Drones, satellites & IoT sensors analyze soil moisture, nutrient deficiencies, and pest
outbreaks. AI-powered systems can achieve ~99% accuracy in early pest detection for jute—
for instance, the "JutePestDetect" model built on transfer learning successfully identified 17
pest classes with 99% accuracy.

 Ground robots now under development (e.g., IIT-Kharagpur’s semi-robotic sprayer) can
inspect crops, diagnose diseases, and apply pesticides precisely—reducing overuse and
improving yields.

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2. Yield Forecasting & Remote Sensing

 AI interprets satellite imagery & weather data to predict crop growth, detect anomalies,
and estimate yields. While specific jute-focused systems are emerging, parallel success in
cotton/organic cotton forecasting highlights the potential for jute .

 These predictions can help jute mills plan procurement, optimize inventory, and streamline
logistics.

35
3. Supply Chain Optimisation & Traceability

 AI-driven platforms support demand forecasting, inventory flow management, and logistics
optimization—helping to reduce both shortages and overstock.

 Integrating blockchain with AI ensures transparent traceability from farm to finished goods,
increasing producer accountability and consumer trust—something MASK Associates is
exploring for sustainability.

36
4. Smart Manufacturing & Quality Control

 AI + IIoT sensors enable predictive maintenance on ageing jute mill machinery, reducing
unexpected breakdowns and cutting maintenance costs by 30–70%, based on textile-sector
benchmarks .

 Computer vision systems scan fabrics in real time, identifying defects, inconsistencies, and
quality deviations to ensure standard-compliant outputs.

37
5. Product Innovation & Customization

 Generative AI tools assist in designing new jute-based products—from décor to

composites—by analyzing market trends and consumer preferences.

 AI-powered analytics evaluate fiber characteristics, guiding R&D for enhanced tensile
strength, texture, and technical properties.

38
6. Sustainability & Environmental Impact

 AI enables optimized irrigation and pesticide management, reducing water usage by 25%
and pesticides by 30% in pilot agri projects—benefits that could directly translate to jute
fields.

 Such precision farming supports eco-certification and improves the jute industry's green
credentials.

7. Market Insights & Strategic Decisions

 AI analyzes big data from sales, exports, and pricing to forecast demand, identify emerging
markets, and guide strategic expansion .

 Tools like Microsoft’s Pest Risk Prediction API already provide voice alerts to farmers about
likely pest outbreaks, helping avoid crop losses

39
 Application of Emerging Technologies of Jute Industry

1. Agriculture & Cultivation

 Precision farming with AI & IoT:

JCI is collaborating with the National Remote Sensing Centre to deploy geospatial monitoring
and digital surveillance across ~1,000 jute cultivation zones—integrating remote sensing
with field data to enhance yield estimation and input management.

 AI-based pest detection:

The “Jute Pest Detect” model applies transfer-learning on DenseNet201, classifying 17 pest
species with ≈99% accuracy. Early intervention via AI can significantly reduce crop loss.

2. Procurement, Traceability & Supply Chain

 Blockchain-enabled raw jute traceability:

Shaktigarh Textile partnered with Borlaug Web Services to pilot blockchain from farm to mill.
Benefits include:

o 20% improvement in procurement efficiency

o 18% reduction in raw jute losses

o Smart contracts for quality control and supply-chain transparency.

 Blockchain for compliance and quality control:

The model ensures immutable audit trails, real-time inspection data, and data security—all
critical for compliance in government procurement and export markets.

3. Manufacturing & Processing

 Industrial IoT (IIoT) with AI:

Jute mills can adopt IIoT to connect legacy equipment, enabling data collection and analytics
for:

o Predictive maintenance (reducing downtime up to 70%)

o Process optimization (driving efficiency gains up to ~30%)

The IIoT framework integrates sensors, edge computing, and cloud-based analytics.

 AI-driven quality inspection:

Real-time computer-vision systems can detect fabric defects and ensure product
consistency, reducing rework and compliance issues.

40
4. Product Innovation & R&D

 Nano-engineered composites:
Integrating graphene with jute fibers increased composite tensile strength by ~110% and
modulus by 324%, opening pathways for high-performance applications in automotive and
construction.

 AI-enhanced design and customization:

Generative design and machine learning create optimized jute-based imagery for decor,
home furnishings, composites, and packaging solutions, aligning products with consumer
preferences .

5. Sustainability, Environment & Market Intelligence

 Precision chemical inputs:

AI–IoT tools in agriculture reduce water and pesticide use by up to 30%, helping jute growers
adopt eco-friendly farming and meet global sustainability standards.

 Data-driven export planning:

Big data analytics provide insights into pricing trends, product demand, and international
markets, supporting diversification strategies and brand positioning.

6. Workforce & Governance

 Training and adoption programs:

Firms like MASK Associates emphasize AI literacy for farmers and mill staff to ensure smooth
technology uptake, community awareness, and local stakeholder collaboration.

 AIoT ecosystem development:

The fusion of AI and IoT—known as AIoT—supports edge computing, sensor integration, and
real-time analytics, essential for modernizing jute mills

41
 Limitations of Latest Technology of Jute Industry

1. Infrastructure & Adoption Barriers

 Obsolete machinery in mills

With ~75% of mills using machinery over 30–40 years old, integrating modern sensors or IoT
components is complex and often impractical.

 Poor connectivity in rural areas

IoT systems require stable internet and power—both unreliable in remote jute cultivation
zones—limiting data collection and automation .

2. Cost & ROI Challenges

 High initial investment

Technologies like AI, drones, blockchain, and IIoT devices involve significant upfront costs—
often unaffordable for small and medium jute mills or farmers without subsidies.

 Weak financial incentives

Obsolete pricing mechanisms (e.g., reverse auctions via GeM) provide little margin to
recover tech investments.

3. Data & Technical Constraints

 Lack of domain-specific datasets

Existing AI tools from cotton or other crops need localized jute-specific data for effective
performance. Creating these datasets is time-consuming and costly.

 Skill shortages
Farmers, mill engineers, and plantation workers often lack the training needed to operate
and maintain advanced tech tools or interpret their outputs .

42
4. Security, Privacy & Interoperability

 Cybersecurity vulnerabilities
IIoT devices are susceptible to hacking and misuse. Most mills lack robust security or the
capacity to manage cybersecurity threats.

 Platform fragmentation & integration issues

A mix of IoT communication protocols—Wi-Fi, Bluetooth, NB-IoT—leads to interoperability
issues, complicating integration across machinery and farms.

5. Blockchain-Specific Hurdles

 Scalability and latency

Blockchain can be computationally heavy and slow, making real-time procurement or
traceability systems less practical in low-bandwidth rural contexts.

 Governance and trust issues

Stakeholders (be it farmers, mill owners, or traders) must trust and comply with the system.
In India, power imbalances and resistance to transparency can hinder adoption .

6. Environmental & Operational Concerns

 Electronic waste & sustainability

Deploying IoT devices means handling e-waste containing toxic components—posing new
sustainability and disposal challenges .

 Maintenance woes
Field sensors, drones, and robots require frequent servicing and calibration—not easy in
remote, resource-scarce locations .

43
7. Regulatory & Policy Gaps

 Lack of tailored support schemes

While modernization programs exist (ICARE, PLI), they mainly focus on machinery—not
advanced AI or digital tooling, leaving adoption incentivisation incomplete.

 Uncertainty in pricing frameworks

Fluctuating MSPs and procurement volatility (e.g., GeM price dips) discourage long-term
tech investment

44
 Conclusion

The Indian jute industry—anchored in the fertile alluvial belts of West Bengal, Assam, Bihar, Odisha,
and Andhra Pradesh—remains a vital agricultural and industrial asset. With roughly 662,000 ha
under cultivation and output of about 1.247 million MT in FY 2022–23, India continues to produce
nearly three-quarters of global jute goods. The sector sustains nearly 400,000 mill workers, 400,000
farmers, and over 4 million rural households, while yielding export revenues of US $471 million.

Yet, despite its scale, the industry grapples with deep-rooted challenges: obsolete milling
technology, low productivity (~1.3 t/ha vs Bangladesh’s 1.6 t/ha), weak supply chains, and increasing
competition from synthetics and subsidized Bangladeshi produce . Governing policies—like MSP
procurement and mandatory jute packaging—provide crucial cushions but have also triggered legal
resistance from sectors like sugar, citing cost and hygiene concerns.

At the same time, rising global demand for sustainable materials extends a fertile opportunity for
the jute sector. Diversification into value-added applications (geotextiles, composites, designer
products) and pilot initiatives in technology (AI-based pest management, IIoT-enabled mills,
blockchain for traceability, nano-composites with graphene) signal a gradual transformation.

However, embracing these emerging technologies is constrained by mismatches in infrastructure,

high capital cost, limited data availability, and connectivity gaps. Mill modernization programs
(ICARE, PLI) and rural training initiatives must be scaled and aligned with digital-first incentives to
catalyze meaningful adoption .

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 Reference

News Articles

 Legal dispute over mandatory jute packaging: India’s government vs sugar industry over
20% jute bag mandate costing industry US $76 million and facing hygiene concerns.

 Raw jute supply crunch & price spike: Industry awaiting ECJ meeting on June 3 to address
soaring costs and delayed crop arrival.

 Surplus sugar and packaging demand: Sugar surplus and impact on jute bag demand amidst
regulatory and pricing pressures .

Research & Industry Reports

 Rediff / PTI: ~30% drop in demand for food-grain & sugar bags, pricing formula issues, GeM
reverse auctions impacting mill viability.

 LiveMint / Telegraph: Demand slump, pricing formula stagnation, call for urgent
government action.

 Business-Standard / AgriInsite: Sugar industry’s moisture and cost concerns with jute
packaging, and non-compliance of jute packaging norms.

Institutional Data

 Jute Corporation of India (JCI): Mandate, MSP mechanism, procurement operations for
supporting 4 million farmer households.

 Textile industry overview: 80 jute mills, 0.37 million workers, major export markets,
challenges vs Bangladesh & synthetics

46