Jute balers want more regulation for payment from millers
The Jute Balers Association (JBA), in a letter to the textile ministry, said that quite a few millers delay payment or even refuse to clear outstanding dues worth 500 crore despite the Centre’s order last year of making prompt payments to raw jute suppliers. It added that some mills clear old dues in lieu of fresh consignment and this “vicious circle continues eternally without any full and final settlement of dues in sight”. It therefore sought more powers be vested in the hands of the jute commissioner to prevent mills from rigging raw jute prices.
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The Jute Balers Association added that raw jute hoarding may have contributed to price increase, but that was not the prime reason for price escalation while a section of jute mills intentionally keep prices going up to lure suppliers. Such desperate trade keeps overall raw jute prices in the open market inflated creating a false sense of scarcity. Many jute mills are cash-strapped despite the government releasing payment for b-twill bag purchases in four to five days since they are diverting money for other purposes instead of procuring raw jute and clearing suppliers’ dues. “Non-payment to raw jute suppliers is the one and only reason for closure of jute mills,” it said.
However, Indian Jute Mills Association chairman Raghavendra Gupta begged to differ. He said that non-payment by a handful of jute mills cannot be the reason for the entire industry to be regulated through government or ministerial intervention. He added that raw jute price are market determined, and should be left to market forces.
Source: Financial Express