Backing from finance ministry imperative

Bank loans worth Tk 200 crore are required to let the state-owned jute enterprises go into full production. At this stage, only Sonali Bank has released funds while Janata, Agrani and Rupali banks are expected to follow suit in the near future.

The need for uninterrupted and timely cash flows to the jute mills can hardly be overemphasised. We are already into the jute purchase season comprising September, October, November and December. The time is running out for the manufacture of jute items to tye up with the export orders that are already in hand. The BJMC is hard put to give performance guarantees to the intending importers because of dearth of finances to buy the raw material, which is jute fibre.

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The demand for hessian, sacking and CBC stands at 500 thousand tonnes, according to FAO estimates. Bangladesh's total production capacity is around 200 thousand tonnes. Due to low prioritisation of the jute sector in Bangladesh over time, we have slid notches down the ladder as exporter of finished items, thereby yielding ground to other competing countries. Unsurprisingly, India has turned out to be the largest buyer of our raw jute.

The established truth is that our raw jute being of the finest quality in the world is correspondingly capable of turning out jute products of the highest competitive quality. To take the fullest advantage of the potential, the finance ministry must persuade the banks to immediately release all the funds that the jute mills need to go into full production.