Government hikes raw jute MSP by 18.5% to Rs 3,200/qtl for 2016-17

NEW DELHI: The government today raised the minimum support price ( MSP) of raw jute by 18.5 per cent to Rs 3,200 per quintal for 2016-17 in order to boost production.

A decision in this regard was taken in the meeting of the Cabinet, chaired by Prime Minister Narendra Modi.

"The Cabinet approved the Agriculture Ministry's proposal on increasing the MSP of raw jute to Rs 3,200 per quintal for 2016-17 from Rs 2,700 per quintal in the previous year," according to sources.

The decision is in line with the recommendations made by the Commission for Agricultural Costs and Prices ( CACP), a statutory body that advises the government on the pricing policy for major farm produces.

The Textile Ministry had sought an MSP of Rs 3,650 per quintal for this year, while other ministries and even Niti Aayog had pitched for marginal increase in the jute MSP by Rs 300 per quintal, keeping in view the inflationary trends, sources added.

The support price has been raised keeping in view the decline in raw jute cultivation in recent years. For instance, area under raw jute has reduced to 7.5 lakh hectare in 2015-16, from little over 8 lakh hectare last year.

Jute provides 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.