EPEF

Jute Manufacturing Sector in India: A Sustainable Potential for Export-Driven Growth

Annwesa Saha

Abstract

The jute manufacturing sector in India, historically known as the ‘golden fibre’ industry, continues to hold substantial potential for export-led growth amid the global transition toward sustainable and eco-friendly materials. This paper analyses the export performance and competitiveness of India’s jute manufacturing sector in comparison with Bangladesh, covering the period 2010–11 to 2021–22. Using panel data regression analysis, the study investigates key determinants such as export price, domestic price, domestic consumption, and international price to assess their influence on export performance. The findings reveal that while India possesses a strong raw material base and significant manufacturing capacity, its export competitiveness is constrained by higher production costs, technological obsolescence, and policy inconsistencies. Export price shows a positive relationship with export growth, whereas domestic price and consumption exert a negative impact. The analysis also highlights that domestic price stabilization policies under the Minimum Support Price (MSP) regime and the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act, 1987, though beneficial for farmers and rural employment, have restricted export supply elasticity. In contrast, Bangladesh’s cost efficiency and export-focused policy framework have strengthened its global dominance. The paper concludes that modernization of jute mills, R&D investment, diversification into value-added jute products, and enhanced supply chain integration are crucial for India to reclaim its global position. Strengthening eco-labeling, innovation, and sustainability alignment will enable the jute sector to contribute significantly to India’s export diversification and green industrial transformation