The Agriculture Ministry has moved a Cabinet note proposing an increase in minimum support price (MSP) of raw jute by 18.5 per cent to ₹3,200 a quintal for 2016-17 in order to boost production.
The jute support price has been fixed at ₹2,700 for 2015-16.
“In the Cabinet note, Agriculture Ministry has proposed an 18.5 per cent increase in jute MSP for 2016-17, which is in line with the CACP’s recommendation, according to sources.
The Commission for Agricultural Costs and Prices (CACP) is a statutory body that advises the government on the pricing policy for major farm produces.
However, in the inter-ministerial comments, the Textile Ministry has sought an MSP of ₹3,650/quintal, while other ministries and even Niti Aayog have pitched for marginal increase in the jute MSP by ₹300 a quintal, keeping in view the inflationary trends, sources added.
The Agriculture Ministry has proposed an increase in the support price because raw jute cultivation has been declining in recent years.
Area under raw jute has reduced to 7.5 lakh hectares in 2015-16, from little over 8 lakh hectares last year.
Jute is providing livelihood to more than 40 lakh farmers in West Bengal, Assam, Odisha and eastern Bihar. It is also the raw material for jute mills, which employ 3.75 lakh workers.