Set to attract investments worth Rs 500 cr
With a jute park having been sanctioned in the Sabbaravarm mandal of Visakhapatnam district in Andhra Pradesh, the jute industry is set to get a boost in the state. The park is proposed to be set up through a public- private partnership at an estimated cost of Rs 100 crore.
Of this, the Central government will contribute Rs 40 crore for creation of physical infrastructure, including roads, office buildings, a laboratory, training centre, raw material and finished goods warehouses and other facilities.
It will also provide a 20 per cent investment subsidy on plant and machinery for units to be set up at the park.
Andhra Pradesh Jute Development Centre (APJDC), a special purpose vehicle formed to promote the jute industry, will pool in another Rs 40 crore and the state government will provide assistance of Rs 20 crore.
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“APJDC will provide training in the production of diversified jute products,” said B V Rama Rao, vice-chairman and managing director of APJDC.
The proposed park is one of six to be established in the country as part of the Union textile ministry’s decision to promote diversified jute products.
The state government, to encourage the jute industry, will supply power at a subsidised 70 paise per unit, reimburse the stamp duty on land registration and hypothecation deeds and offer a three per cent rebate in interest on loans.
Rao said the SPV would also facilitate financial assistance through banks and arrange to supply raw material, as well as market the finished products in India and abroad. “The jute products have good prospects,” he said.
The proposed park would attract investments worth Rs 500 crore, said Rao, who now heads Swarnandhra Jute Mills in Srikakulam district. He said his company would set up a Rs 50 crore integrated project at the jute park.
“There is a potential to create employment for about 20,000 people at the jute park.” This would also aid in increasing the cultivation of mestha — a fibre produced by this plant often used together with jute — from the current 75,000 acres in Andhra Pradesh, he said.
The state has nine composite jute mills with a combined capacity of 530 tonnes per day and 20 twine mills with a capacity of 330 tonnes per day, and employing about 50,000 people.
Units that have started with capacities of 5-10 tonnes per day have upgraded to 70-100 tonnes per day now. Most jute industrialists in the state are from West Bengal.
“There is a need to incentivise jute cultivation. The government should also supply seeds to farmers,” Rao said, adding that there was a need for extending collateral-free loans to entrepreneurs.
Industries also face raw material shortage and most of it is now sourced from Bengal. It now commands a price upwards of Rs 1,375 a tonne.
The product range now includes executive bags, wall hangings and interior decoration items which are being exported to Italy, Belgium, Germany, the US, Sri Lanka and other countries. Jute exports from India are valued at Rs 1,500 crore per year.
