Why are Jute Mills Being Shut Down in Bengal?
“majdoor majboor hota hai,” The labourer is always helpless says T. Das, a worker at the Naihati Jute Mill in North 24 Parganas West Bengal, after losing his job. He was issued a ‘Suspension of Work’ notice on January 6 without prior information. Two mills in the Hooghly district, the India Jute Mill and Gondolpara Jute Mill were also stopped in January. Over 12,000 people were working there.
Once an impetus to economic growth, the jute industry in India has been throttled in more recent times. At least 46 jute mills were halted in the past decade, temporarily or permanently. Twelve were stopped last year; the Gondolpara mill has been paused nine times since 2010.
All the managements cite labour unrest as the reason for closing their doors, along with a shortage of raw jute caused by a Union government price cap on jute fibre purchases in West Bengal. Another 15 mills may soon tread the same path, threatening the incomes of 50,000 families of workers.
About 4,000 people lost their jobs when the Naihati Jute Mill was stopped
“There has been severe deterioration of basic working environment in the Cop Winding section where a group of workmen, without having any patronage from majority of the operating unionts, all by themselves act as serious deterrent force in the running of the mills,” claim the authorities of the Naihati Jute Mill in the ‘Suspension of Work’ notice.
The workers reject this claim. “They shut the mill due to our protest. They wanted us to work without any hike,” says T Das, 43, who lives in one of the workers’ quarters in Hazinagar opposite the mill. “Most mill workers living in one-bedroom quarters were just about making ends meet. Now we have nowhere to go.”
Reports say workers in many jute mills were asking for lay-off wages, wages for the lockdown period, and the clearing of dues for retired workers. There were also demands to recover the raw jute allegedly being stocked by traders to manipulate prices, to continue operating the mills.
Labourers live in one-bedroom quarters opposite the Naihati Jute Mill
The distress, say industry experts, was caused by the Jute Commissioner’s Office, which imposed a “reasonable” price cap of Rs 6,500 per quintal of raw jute purchased in West Bengal. The cap, imposed by the Union textiles ministry last September 30 remains in effect until the end of the current jute year, on June 30.
The Indian Jute Mills Association, the apex body representing the mills, wrote a letter to Prime Minister Narendra Modi requesting him to intervene and relax the price cap. IJMA chairman Raghavendra Gupta said that raw jute had not been made available to mills at the ceiling price for a single day. IJMA further said that 2.5 lakh mill workers and 40 lakh farming families had been affected by the price cap decision. Adding that the price mills pay to traders for raw jute includes transport and handling costs that were not considered by the JCO.
The Jute Commissioner however is undeterred. IJMA has now threatened legal action against the Centre. “We are planning to take legal remedy soon as raw jute prices remain at Rs 7000 per quintal and above. We are making losses as we continue to buy raw jute at Rs 7000, while the government will pay us at the declared price of Rs 6500 per quintal,” the IJMA chairman told the press.
Jute farmers in North 24 Parganas support these arguments. “We sell our product [raw jute] to middlemen [jute traders who then sell the fibre onward] at a price of Rs 6-7,000 per quintal. Sometimes, people also get a price of Rs 9-10,000 per quintal if the cultivated products are good. But that’s very rare,” says Bidhan Biswas, a jute farmer in Baraberia village, Nilgunj.
Bidhan Biswas is the sole earner for his family of six
Jute is largely grown in the delta shared by West Bengal and southwest Bangladesh, and in parts of Assam, Meghalaya and Tripura in the period between February/March and May/June, before the monsoon. It is also grown in Nepal, China, Vietnam, Myanmar, Thailand, Egypt, Uzbekistan and Zimbabwe.
West Bengal is considered the hub of India’s jute industry, valued around Rs 10,000 crore, and in 2016 the state housed 70 of the 93 mills in India. The long, soft, shiny bast fibre is used to produce bags, hessians, twines, ropes, mats and several other textile blends.
Jute is fully biodegradable and recyclable. “A hectare of jute plants consumes about 15 tonnes of carbon dioxide and releases 11 tonnes of oxygen. Cultivating jute in crop rotations enriches the fertility of the soil for the next crop. Jute also does not generate toxic gases when burnt,” says a report on Future Fibres by the UN FAO.
Jute is second only to cotton in terms of the amount produced, and is one of the most affordable natural fibres in the world (Facebook/ IJMA)
Another study from 2017 estimates that a hectare of jute crop leaves some 2,000 kilos of aboveground biomass (leaves, tops and branches) annually to the soil. Authored by AK Singh of ICAR-Central Research Institute for Jute and Allied Fibres, the study further says that such crops have a lower carbon footprint and “can be a double win in the form of enhanced adaptation, increased mitigation and stability in the jute based farming system, and sustainability in the country.”
Amidst growing awareness of the hazards of plastic in a global climate crisis, one forecast suggests that the global jute bag market was valued at USD 2.1 billion in 2020, and is estimated to be worth USD 3.1 billion by 2024.
Excited by the projection, the Indian government attempted to cash in and control the damage in this crumbling industry. However, government policy has resulted in the shutting down of at least 12 mills in West Bengal during the last one year’s time. The Centre’s refusal to increase the cap price for purchasing raw jute to Rs 7,200 as demanded by the jute mills, has pushed the industry into unprecedented crisis.
In November 2021, New Delhi made it mandatory to use jute bags to pack all foodgrains and 20 percent of sugar for the Jute Year 2021-22, ignoring the crisis that had been boiling in the jute industry. As a result, in November and December last year, the industry incurred a loss of Rs 1,500 crores. It failed to produce the 4.8 lakh bales of jute bags required by the government, due to the shortage of raw jute caused majorly by the Centre’s own decision. The jute bags were then replaced by a non-biodegradable, fossil fuel substitute: plastic bags.
At a meeting on December 13, Union Textile Minister Piyush Goyal took a u-turn on his ministry’s decision in November, reportedly asking the mills to reduce the supply of (B Twill) bags used to package foodgrains if they found it unprofitable to comply with the government-issued cap price. He said this knowing that jute mills rely heavily on government purchases to meet their financial needs.
According to a news report, deputy jute commissioner Koushik Chakraborty said the Commission for Agricultural Costs and Prices had suggested an MSP of Rs 4,500 for a quintal of jute after estimating a production cost of Rs 2,832. He claimed that the cap price of Rs 6,500 per quintal was “hugely profitable”.
However, jute farmers in North 24 Parganas criticised the decision. “It’s wrong to assume that we make lots of profits in harvesting jute. Yes, in a good season we grow 4-5 quintals of jute on a bigha of land. But weather is not same anymore. Now, we hardly grow around 2 quintals on a bigha,” said Hashi Kirtaniya, a jute farmer in Baraberia. She cultivates jute and other crops on 2 bighas of land owned by her husband.
Hashi Kirtaniya in her field growing paddy. She will plant jute seeds here after the paddy season
Jodi Bala, another farmer in the region explains, “The government calculates everything on the basis of an average. But a small farmer with 1-1.5 bighas of land will earn less than a famer with 4-5 bighas of land. But the cost of pesticides, fertilisers, diesel and electricity is the same for everyone. How is that fair?”
The central government has also alleged that farmers and traders are stocking raw jute to create a shortage of supply and increase the price of the fibre in the market. The Centre has, thus, made it mandatory to sell raw jute within 45 days of harvesting.
Farmers refute the allegation. Bala asks, “Where can we stock it? Like me, most jute famers own 1-2 bighas land. Our annual profit from farming stays between Rs 1-2 lakh. I don’t have enough money to build a proper house. How do I build a godown to stock jute?”
It is clear that not just the jute mill workers, but the farmers are also undergoing a calamity. And the government has decided to turn a blind eye to the farmers’ problems as well.
All the farmers in Baraberia village grow various seasonal crops besides jute
It is true though that the ongoing crisis in the jute industry is not a modern-day phenomenon. To understand what has gone wrong and how saliently the stars have fallen for jute over the years, one has to look at the history of the industry in undivided Bengal, the detrimental impact of Partition and the damaging series of events that followed.
Known as the golden fibre, jute was once the most important industry in India after cotton. The jute manufacturing industry in India was established 170 years ago, just 17 years after it was pioneered in Scotland’s Dundee in 1838. The first jute mill in India, the Acland Mill, was established in Rishra in the undivided Bengal Presidency (in today’s Hooghly district).
Languishing behind its Scottish counterparts in the initial years, the Indian jute industry started to grow by the turn of the 19th century due to the “unprecedented growth of international trade, the growing global significance of jute products, and the critical role of Indian raw jute”, writes historian Tara Sethia in her paper ‘The Rise of the Jute Manufacturing Industry in Colonial India: A Global Perspective’.
More mills were established, mostly near Calcutta, in Howrah, Hooghly, and in the 24 Parganas. By the 1910s, Calcutta Mills had become the world’s largest jute producer, employing more than 300,000 people. Bengal soon established a monopoly on the jute industry, after the golen fibre found military use in the Crimean War, and later the First World War.
More than a billion jute sandbags were transported to the trenches during the First World War
The jute industry reached its absolute peak during the Second World War and the immediate period afterward. “The First World War was, for the industry, remarkable only for the vast quantities of sandbags ordered. In the Second World War there was a very different story to tell,” wrote WAM Walker, the then UK representative of the IJMA, in 1949.
“When Japan entered into the war, it was soon evident that the jute industry would be called upon to play a much larger part in the scheme of events and to make greater and more exacting effort than ever before in its history.”
In August 1947, “The total annual value of the Indian jute crop, after allowing 5 per cent for domestic consumption, was well over 100 crores of rupees or £75,000,000, of which about 20 per cent was exported. The production of the Indian mills approximated in value 130 crores of rupees or £97,500,000, of which the exports amounted to about 105 crores of rupees or £79,000,000 and constituted a very high percentage of the total vale of all exports from India. The mills employed about 300,000 workers and millions in the jute growing district derived their cash income from jute.”
Partition: Beginning of the end
The jute industry in India received its first major blow when Bengal was divided into West Bengal and East Pakistan (now Bangladesh). After the partition, 75 percent of the jute-growing land went to East Pakistan, while all the mills remained in India, mostly in West Bengal, writes historian Anwesha Sengupta in ‘Unthreading Partition: The politics of jute sharing between two Bengals’.
Furthermore, as Pakistan failed to devalue its currency like India, the selling prices of raw jute in Pakistan and buying prices in India varied widely, leading to a shortage in supply. Sengupta writes, “To pressurise Pakistan to resume its jute supply, the Indian government decided to stop coal supply to Pakistan towards the end of December 1949. Thus, a full-fledged trade war began.”
Plastic soon replaced jute as the major packaging material in industrialised countries (Facebook/ IJMA)
Diplomatic and communal tension between the two countries was exacerbated by the jute/coal crisis. 60,000 maunds of raw jute were burnt in Narayanganj, East Pakistan in September 1950, while jute mills in West Bengal were often “the worst sites of communal violence” in that time.
After the “total breakdown of Indo-Pak jute diplomacy”, many countries began experimenting to find a substitute material for packaging. The Korean War intensified experiments around the globe with the importance of jute as a packaging material declining in industrialised areas. The polymer plastic soon replaced jute in this role, becoming widely and inexpensively available.
One estimate records “a decline of 40–60 percent in the jute consumption ratio between 1957 and 1965–70 in industrial countries,” with a decline of 10-20 per cent in India and Pakistan. Sengupta writes, “Thus, the glorious days of jute were over, and partition had a significant role to play in this.”
Indian jute mills began to reflect the repercussions soon after Partition, with five of them being forced to shut down within a year. With the supply of raw jute declining, the government decided to launch a ‘Grow More Jute Campaign’ to increase the production of raw jute. Attempts were made to grow jute outside of the traditional jute growing regions of West Bengal and Assam.
In West Bengal, 243,000 acres of paddy land were converted to jute fields. That proved counterproductive, says Sengupta, as apart from jute growing land, West Bengal had also lost most of the fertile paddy fields to East Pakistan. Hunger and undernourishment soon crippled the state, leading to two major food movements in 1959 and 1966.
A farmer working her paddy field in Baraberia, North 24 Parganas
Although the food crisis was resolved to some extent in the following years, the jute industry got no remedy. Debraj Bhattacharya, author of Exploring Marxist Bengal, writes that while New Delhi protected the domestic market industries through import tariffs between 1966-76, “it did very little to promote export-oriented industries like jute and tea, which were the traditional industries of West Bengal”.
As West Bengal’s jute industry continued its downward journey, unemployment began to rise in the state leading to massive labour movements. Economic recession, freight equalization, and licence raj (in 1977 Bengal’s industries only got 40 licenses compared with 150 for Maharashtra) played equal roles in demolishing the dominance of the state’s industries, including the jute sector.
Left rule and unions
The Left Front government, led by the Communist Party of India (Marxist), that came to power in 1977 “inherited a declining industrial economy” in West Bengal, writes Bhattacharya. The state government’s decision to lift small industries and limit the dominance of big Indian and foreign multinational firms in the organised sector further hit the jute mills that were mostly owned by rich Marwari businessmen or by European companies.
The jute industry continued to decline as the Left Front government initially opposed the country’s economic liberalization in 1991. Though it changed its policy a few years later and opened West Bengal to foreign investment, it did not arrest the decline of the golden fibre. The trend gave birth to militant trade unionism in the 1990s, considered by many the foremost factor for the lack of industries in West Bengal.
In 1996, sociologist Sarath Davala wrote how trade unions affiliated with political parties had failed to fight for mill workers’ rights. In his article on ‘Independent Trade Unionism in West Bengal’ Davala writes that in time mill workers turned their back on party unions, instead forming “save committees” that mushroomed into independent unions.
Residents of the Naihati Jute Mill quarters also blamed trade unions for closure of the mill
Davala argues that “The formation of bachao committees and majdoor samithis in jute mills is a clear reflection of the redundancy of party unions which have been responsible for deep fragmentation of labour in every unit.”
“Such fragmentation suited these unions as long as their job was merely to negotiate wages and sign settlements or sit on various committees formed by the government, or for that matter do a number of things on behalf of labour.
“However, when the question of fighting against closure or job losses came, which required all the workers to fight as a united force, their limitations and contradictions immediately surfaced.”
Many had felt hope in 2011, when the Mamata Banerjee-led Trinamool Congress was elected to govern West Bengal. But things have hardly changed for the better. In the current crisis, the state government hasn’t taken any aggressive stand against the central government’s decision, despite Chief Minister Mamata Banerjee’s declared opposition to the move.
“All of them are together in it. The unions can be from different parties, but actually they are all together. They only care about money. We don’t matter here. Do you think the mill owners have the power to shut down a mill without taking permission from the TMC union?” said P Das, a worker in the now-closed Naihati Jute Mill.
Photographs: Niladry Sarkar