Expanding global share of Bangladeshi jute exports by exploring high-priced markets

Expanding global share of Bangladeshi jute exports by exploring high-priced markets

The international market in Jute textiles has resisted the negative effects of the global financial crisis. Bangladesh can therefore afford to capitalize on this. This report aims at identifying the weaknesses and strengths of Bangladeshi jute industry in order to provide appropriate directions of reform for the growth and development of the sector.The paper notes that Jute mills manufacturing achieved considerable growth in the last two decades. However, poor management is a concern for the public sector, and lack of financial viability is a common serious problem.

Suggested policy implications include:

·         an optimum size for jute firms appeared to be small and medium size

·         instead of exporting raw jute with minimum value addition, increasing use of jute in traditional jute mills, and manufacturing of diversified products can be more gainful 

·         a national “Jute Board” can be established to design an appropriate strategy for higher domestic use of raw jute and more domestic value addition

·         the operative word should be efficiency, thus a public-private partnership could be explored as a possible strategy

·         the possibility of duty-free export of jute goods to the Indian market, under the SAFTA agreement, has to be considered, and high-priced markets in developed countries have to explored 

Recommendations are that:

·         a thorough review and revision of the financial account of jute mill’s public sector is required before undertaking any reform

·         the public sector jute mill management should revise the marketing strategies

·         government rules on restriction of manufacturing and marketing of polythene products should be strictly maintained

·         in order to make operation of jute mills financially viable, the debt burden needs to be restructured and written off where necessary

·         the government’s initiative to design a new jute policy needs to be adjusted with the prospects of global demand on jute in the coming years