Bangladesh: jute boom

After years of decline, the 'golden fibre' is resurgent. How will this effect Asia's 4th poorest economy?

Only Afghanistan, Myanmar (Burma) and Nepal have lower per capita GDP (PPP) levels right now among Asian countries. And Bangladesh faces huge challenges: climate change causing rising sea levels, rapid population growth, corruption and painfully slow economic reform. So news that jute is a reviving industry could not have come at a more opportune time. 

Although it's considered to be the most important natural fibre after cotton, jute production had long been stagnating. That wasn't always the case. "The great boom in the industry in the second half of the nineteenth century was built above all on the production of jute bags, used for the transportation of all manner of agricultural products, coal, fertilizers and chemicals" writes Professor Jim Tomlinson of Dundee University. And the industry was buoyant during both World Wars as producing countries satisfied the need for sand-bags. However, later competition from synthetics like polythene and plastic almost killed off production.

The occasionally made trendy jute tote bag didn't quite stimulate the demand necessary to keep all those West Bengalis near Kolkata and Bangladeshis employed. By the 1980s, Bangladeshi farmers were burning their jute crops as prices tumbled. They diversified, and government agencies in Dacca either closed or downsized.

Now, the BBC reports the "natural fibre has made a spectacular comeback. Exports of jute and jute products from Bangladesh this fiscal year crossed a record billion dollars as demand for the natural fibre is steadily increasing. With growing environmental awareness, jute, which is bio-degradable, has become the preferred alternative to polluting synthetic bags." Inventive and creative scientists are thinking of other uses too. According to the BBC "Bangladeshi scientists are now working on an ambitious project to blend jute fabric with cotton to produce denim fabric.They say if the jute plant is harvested earlier than the usual period of 120 days, then it gives a softer fabric." More research and greater marketing is required apparently.

Providing 30% of the world's needs, Bangladesh is the second highest jute producer after India. The UK, Spain, the Ivory Coast, Germany and Brazil are key importers of raw jute. However jute mills are big business again in Bangladesh, and by-products of the commodity can be used in paints, cosmetics and even medicines.

As it is totally bio-degradable and recyclable it meets the criteria of green enthusiasts. It's time has come once again in an increasingly environmentally conscious world.

The Economist calculates that Bangladesh's population will hit 222 million by 2050 (it stands at around 142 million now). And Goldman Sachs, an investment bank, foresees the country's economy becoming the 22nd largest by 2050, rising from 47th in 2010.

Jute production and by-product manufacture will help considerably in meeting that forecast. However, will rising waters thwart this ambition?

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