Niti Aayog recommends closure of five jute mills in Bengal

As many as 20,000 may lose their jobs in the state.

kolkata Updated: Oct 24, 2016 09:23 IST
Subhendu Maiti
Subhendu Maiti
Hindustan Times
Jute mills,West Bengal,Niti Aayog
Both the cultivators and mill workers, the two main segments of the jute industry, are going through turbulent times.(HT Photo)

Bengal’s industrialisation move is all set to suffer a setback. Niti Aayog , a policy think tank established by the Narendra Modi government replacing the Planning Commission, has recommended the closure of six sick jute mills including five units from Bengal at a time the state government is desperately trying to woo investors.

Around 20,000 workers including casual staff in these five jute mills in Howrah and North 24-Parganas district will be rendered jobless following the implementation of the recommendation.

Read: Rahul reaches out to jute mill workers in Bengal

The jute industry is one of Bengal’s traditional big blue collar employers with 59 mills employing close to 4 lakh workers. Though the sector has been regularly plagued by technological obsolescence -- synthetic fibres fast consuming its market -- such a large closure of mills at one stroke is not common in the state.

Niti Aayog has also recommended to the cabinet committee to close down the National Jute Manufacturers Corporation (NJMC), a public sector undertaking of the central government. NJMC had taken over these six mills including the Katihar unit in Bihar decades ago. The cabinet committee will take a final decision on the closure.

Chief minister Mamata Banerjee is expected to react strongly to the Niti Aayog recommendation. (HT Photo)

At present NJMC that is headquartered in Kolkata is engaged in manufacturing jute products through its three running mills in North 24-Parganas and Katihar in Bihar.

It is almost certain that Trinamool Congress chief and Bengal chief minister Mamata Banerjee will pick it up

“We have received a copy of the Niti Aayog’s recommendation for closure of the NJMC and six jute mills under it. Five mills in Bengal have already stopped production despite the Centre’s revival package initiatives. Niti Aayog has sent its recommendation to the cabinet committee sending a decisive message for permanent closure of these mills where about 20,000 workers used to work,” Kushal Bhaduri, NJMC chairman cum managing director, told HT.

Niti Aayog is not happy with the production in these six units despite pumping in crores of rupees for their revival.

Read: Six arrested in West Bengal jute mill CEO lynching

Sources in the NJMC told HT productivity is so poor that in a mill around 120 workers are engaged in manufacturing only one metric tonne jute product. According to the assessment of the Niti Aayog, hardly 40 workers are required to produce same quantity.

The Centre has given more than Rs 10,000 crore. This includes Rs 8,800 crore as loan and the rest for voluntary retirement of workers and revival package of two mills in Khardah and Titagarh to the NJMC in different phases during the past several years. The centre has also waved a huge portion of the loan amount Rs 8,800 crore.

At the time of the nationalisation, NJMC mills produced around 1.10 lakh tonnes of jute goods every year and this figure rose to 1.33 lakh ton annually around three decades ago. However, there was a continuous decline in production thereafter.

First Published: Oct 24, 2016 09:23 IST