The Union food ministry has belied the jute industry’s claim that overestimation was done to accommodate purchase of plastic bags replacing jute bags in the rabi marketing season (RMS) of 2013-14.
The ministry had decided to reuse leftover plastic bags purchased during the last RMS in the current year. The Central government, however, had shot down the decision on complaints from the jute industry that it was beyond rule and the ministry had done an overestimation on demand for the jute bags.
“The estimation on the requirement of packing materials, including plastic bags, was done in 'full consultation’ with various stakeholders, including representatives of the Indian Jute Mills Association (IJMA), and all were aware of the purchase,” R K Vashisht, under secretary, food ministry, said in a letter to the government.
This is the second occasion that the jute industry has been caught on the wrong foot. Earlier, the Jute Commissioner accused the jute industry for diverting jute bags meant for supply to government agencies in the open market at higher prices.
The sugar industry had already dragged the jute industry before the Competition Commission of India (CCI), alleging manipulation, cartelisation and rigging of prices.
According to Jute Packing Materials Act (JPMA), 1987, food grains and sugar produced in the country are to be compulsorily packed in jute bags. The Act allows an exemption of 30% for packing in other materials if jute bags are not available.
On November 28 last year, the Cabinet Committee on Economic Affairs (CCEA) decided on a further exemption and decided that 10 and 80 per cent plastic bags (high density polyethylene HDPE /polypropylene PP) would be used in 2013-14 for packing food grains and sugar.
As per estimates, the industry has the maximum capacity to produce around 1.2 million tonne of jute bags, while the total requirement would be more than 1.7 million tonne. The jute industry has challenged the position pointing out it has an installed capacity to produce 1.5 million tonne.
The Food ministry had decided to reuse left-over plastic bags purchased for RMS 2013-14 and the textile ministry had shot down the proposal after complaints from the jute industry. There are no rules in JPMA that prevents the food ministry from reusing packaging materials.
The ministry had decided to reuse leftover plastic bags purchased during the last RMS in the current year. The Central government, however, had shot down the decision on complaints from the jute industry that it was beyond rule and the ministry had done an overestimation on demand for the jute bags.
“The estimation on the requirement of packing materials, including plastic bags, was done in 'full consultation’ with various stakeholders, including representatives of the Indian Jute Mills Association (IJMA), and all were aware of the purchase,” R K Vashisht, under secretary, food ministry, said in a letter to the government.
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According to the ministry, purchase of plastic bags had been a ''fall-back option” and jute bags always received the priority.
This is the second occasion that the jute industry has been caught on the wrong foot. Earlier, the Jute Commissioner accused the jute industry for diverting jute bags meant for supply to government agencies in the open market at higher prices.
The sugar industry had already dragged the jute industry before the Competition Commission of India (CCI), alleging manipulation, cartelisation and rigging of prices.
According to Jute Packing Materials Act (JPMA), 1987, food grains and sugar produced in the country are to be compulsorily packed in jute bags. The Act allows an exemption of 30% for packing in other materials if jute bags are not available.
On November 28 last year, the Cabinet Committee on Economic Affairs (CCEA) decided on a further exemption and decided that 10 and 80 per cent plastic bags (high density polyethylene HDPE /polypropylene PP) would be used in 2013-14 for packing food grains and sugar.
As per estimates, the industry has the maximum capacity to produce around 1.2 million tonne of jute bags, while the total requirement would be more than 1.7 million tonne. The jute industry has challenged the position pointing out it has an installed capacity to produce 1.5 million tonne.
The Food ministry had decided to reuse left-over plastic bags purchased for RMS 2013-14 and the textile ministry had shot down the proposal after complaints from the jute industry. There are no rules in JPMA that prevents the food ministry from reusing packaging materials.