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Jute Exports from India: How to export Jute products from India a Complete Guide
- Saurabh Pandey
- Apr 12, 2023
- 9 min read
How to export Jute products from India.
Jute, a natural fibre that is commonly used to make burlap and other products, is one of India's top exports. In fact, between 2015-16 and 2020, India's jute exports increased by over 60%, from $167 million to $272 million.
Table of Content
1) Jute Export Trade Stats and Forcast for the next five years 2023-2028.
According to the Ministry of Commerce and Industry, India's jute exports in the financial year 2020-21 (April 2020 to March 2021) were worth USD 202.74 million. This is a decrease of 4.84% compared to the previous financial year 2019-20 when jute exports were worth USD 213.05 million.
India's jute export market has witnessed substantial growth over the years, with the total exports of jute and jute products reaching over INR 38 billion in the financial year 2022. This growth can be attributed to the rising demand for eco-friendly products globally and favourable government initiatives focused on sustainable development. The jute diversified products (JDP) accounted for the highest share of exported jute items, with 2020-21 exports valued at around USD 163 million. The sacking and hessian products followed this with exports valued at USD 65 million and USD 47 million, respectively. The yarn exports also showed growth of 23.1% over the previous year, and the raw jute exports significantly increased to USD 58 million.
Furthermore, the global jute bag market is expected to reach USD 3.3 billion by 2026 with a CAGR of 9.4% during the forecast period of 2023-2028. The overall sales in the global jute bags market are predicted to expand by 1.6X over the forecast period (2022-2032). The market size of the global jute bag market reached US$ 2.5 billion in 2022, and IMARC Group expects it to reach US$ 4.2 billion by 2028, exhibiting a growth rate (CAGR) of 8.67% during 2023-2028. The rising demand for eco-friendly products and increasing environmental concerns among consumers are the key factors driving the global jute bags market's growth.
2) What are the HSN code Jute Export from India?
India's jute exports are primarily categorized into three product categories: jute baskets (HSN codes 57050039, 57050029, and 57050090), jute bags (HSN code 63053900), and jute yarn (HSN codes 53072000, 53071090, and 53071010). The top three categories for jute basket exports are categorized under HSN codes 57050039, 57050029, and 57050090, while jute bags come under HSN code 63053900. Finally, for jute yarn exports, the top three categories fall under HSN codes 53072000, 53071090, and 53071010.
3) Government Bodies and EPCs
(What are the Government Bodies & Export Promotion Councils that support the export of jute from India?)
For the modernization and development of the jute industry in India, the National Jute Board has implemented several schemes and initiatives. Some of the schemes meant for the improvement in production are Improved Cultivations and Retting Exercises (ICARE), Jute Diversifications Scheme, Jute Resource-cum Production Centre (JRCPC), and Jute Retail Outlet Scheme for exposure to products and artisans.
The Market Development & Promotion, Domestic Market Promotion Activities (DMPA), and other publicity and promotion activities and schemes are meant to increase the sales and exports of jute products in India.
Export Market Promotion Activities (EMPA)
Under EMPS, the government implements various activities like international-level fairs in India, international fairs abroad, international mega fairs, business delegations/ road shows/ international conferences and seminars, etc.
Market Development & Promotion Scheme (MDPS)
MDPS scheme aims to develop, promote and expand markets for Jute and Jute diversified products within India and abroad. It provides selling, marketing, and promoting platforms/avenues to Jute Artisans, entrepreneurs, women self-help groups, Jute MSMEs, Jute exporters, and Jute millers.
Capital Subsidy for Acquisition of Plants and Machinery (CSAPM) Scheme
CSAPM scheme has been approved by the Ministry of Textiles, Govt. of India and is implemented through the National Jute Board (NJB), a statutory body under the Ministry of Textiles, Govt. of India. The objective of the Scheme is to provide financial assistance to the beneficiaries for the purchase of Jute diversified products (JDP) manufacturing machinery. This Scheme is initiated under the National Jute Development Program (NJDP) umbrella scheme of NJB during the 15th Finance Commission (2021-26).
4) Top Jute producing States in India & their production trend.
(Which states in India are the top producers of jute and could be considered for sourcing jute at the best price?)
According to the third advanced estimate released by the Union Ministry of Agriculture and Farmers Welfare in May 2022, the production of jute in India has decreased by over 13% in the past decade. The production has fallen from 2.03 million tonnes in 2011-12 to 1.77 million tonnes in 2021-22. Similarly, the land under jute has also decreased from 0.82 million hectares between 2000-01 and 2009-10 to 0.73 million hectares between 2010-11 and 2019-20. In West Bengal, which is the country's largest jute-producing state and has 70 out of India's 93 jute mills, the area under jute has decreased by 0.1 million hectares between 2009-10 and 2020-21.
Jute is mainly grown in West Bengal, Bihar, Odisha, Assam, Meghalaya, Tripura, and Andhra Pradesh, with West Bengal being the largest producer, accounting for 80% of India's jute production. It is followed by Assam and Bihar. In the year 2020-21, West Bengal produced 7592.8 thousand bales, accounting for 81.17% of India's jute production. Assam and Bihar produced 794.2 thousand bales and 787.5 thousand bales, respectively. The other states that produced jute were Meghalaya, Nagaland, Odisha, Andhra Pradesh, Tripura, and Chhattisgarh.
The decline in jute production and land under jute cultivation is a matter of concern as jute is an important cash crop in India. The government needs to take necessary measures to increase jute production and encourage farmers to cultivate more jute. The decline in jute production can be attributed to various factors such as decreasing demand for jute products, competition from other fibres, and lack of modernization in the jute industry.
5) What are the top Jute-producing countries in the world?
we should proudly say that India is the world's leading producer of jute, annually producing more than 1.968 million tonnes. The country's jute production process is impressive, using technology-based cultivation methods. West Bengal, Bihar, Uttar Pradesh, Meghalaya, Assam, and Orissa are the major jute-producing regions in India. India meets global demand by exporting 50% of its jute products worldwide.
Bangladesh is the world's second-largest jute-producing country, with an annual production of 1.349 million tonnes. Jute was cultivated over 7.5 hectares of land, 10% of the country’s agricultural area. Although the country was once the global leader in jute production, its lack of technological advancements in jute cultivation led to stagnant production, which was later surpassed by India. To meet the global target, Bangladesh exports 42% of its jute products worldwide. Tangail, Dhaka, Jessore, Jamalpur, Bogra, and Faridpur are the major jute-producing regions in Bangladesh.
China ranks third in jute production, with an annual production of an estimated 45,500 metric tonnes. Although China has the highest per-acreage yields in jute farming globally, the country focuses on producing other products, causing its jute sector to decline in the global market.
Uzbekistan ranks fourth among jute producers, with an annual production of approximately 20,000 metric tons. Most jute farming in Uzbekistan is done by small-scale farmers, although state farms also contribute significantly to agricultural production.
Nepal ranks fifth among the top jute producers globally, with an annual production of approximately 18,000 metric tons. Jute production in Nepal is concentrated in the Terai belt, with most plantations located in the Eastern region of Koshi, Sagarmatha, and Mechi Zones. Nepal exports many unique and traditional jute and jute accessories worldwide.
Myanmar holds the sixth position among global jute-producing countries, with an estimated annual production of 17,000 metric tons. The country has created a suitable environment that promotes farming, making it a leading exporter of several agricultural products, including jute.
Thailand ranks seventh among jute-producing countries globally, with an annual production of approximately 12,000 metric tons. Although the country is popular for exporting handicraft items, jute is its second-largest exporting sector. Jute farming is still ongoing in Thailand, making it one of the leading exporters of the crop.
Vietnam ranks eighth among jute-producing countries globally, contributing 20% to its agricultural sector. Jute products are the most exported products in Vietnam. The Hanoi Jute Company is the country's largest producer, producing jute nets, bags, sacks, ropes, and sheets.
Sudan is the ninth-largest jute-producing country, with an annual production of approximately 3,350 metric tons. Although Sudan is one of the smallest and poorest countries in the African sub-continent, jute products are among its major exporting products, contributing $906,000 yearly to the country's GDP.
Egypt ranks tenth among global jute-producing countries, with an estimated annual production of 2,508 metric tons. The country cultivates jute and is among the leading exporters of jute globally, as well as the second-ranked producer in the African continent. In Egypt, jute is called "mulukhiyya."
6) Top Importing Country for Jute products from India.
India is a major exporter of jute and jute products to various countries across the world. The United States, the United Kingdom, Australia, Belgium, Egypt, Germany, Italy, Japan, Saudi Arabia, and Turkey are the top importers of jute and jute products from India. In 2021-22, the United States emerged as the leading importer of jute products from India, followed by the United Kingdom and Germany. According to statistics from the National Jute Board, between April 2021-October 2021, the total exports of jute goods to the top 20 countries accounted for 83% of the total exports, valued at Rs. 20,214.48 million (US$ 263 million).
The United States was the top destination for all jute goods exports from India, followed by France and Ghana, accounting for 26%, 11%, and 9% of the total exports, respectively.
During the same period, India's jute diversified products (JDP) exports contributed to the top 20 countries and accounted for 95% of the total JDP exports, valued at Rs. 9,316.05 (US$ 121 million). The United States, France, the United Kingdom, the Netherlands, and Spain are the top five destinations for jute diversified product exports from India. In terms of jute fabrics, Germany is the top importer country in the world, accounting for 14.9% of the total imports. On the other hand, Ghana is the largest importer country of jute bags, accounting for 14.3% of the total value in 2022.
Overall, India is a significant player in the global jute and jute products market, with a diverse range of products exported to various countries across the world. The country's traditional markets continue to account for a significant share of exports, but there is also growing demand for jute diversified products in various countries.
7) Documents required for Jute export from India
(How to export Jute products from India( Jute Yarn, Jute Bags, Jute fabric etc.) from India ??)
If you're looking to export jute products from India, there are a few documents you'll need to prepare and regulations you'll need to follow. Firstly, you'll need to obtain an Import Export Code (IEC) from the Directorate General of Foreign Trade (DGFT) and a Registration/Membership Certificate (RCMC) from an Export Promotion Council(s). Once you have these, you'll need to prepare a few essential documents, such as a Bill of Lading, Bill of Export, Commercial Invoice, Foreign Exchange Form, and Documents against acceptance and payments. It's also crucial to label and stamp your exported items appropriately and obtain insurance against credit risks.
You'll then need to run an inspection and obtain a certificate from the Export Inspection Agency. It's important to determine the updated exchange rate so the transaction of the shipment is smooth. The exporter also needs to follow the provisions of the Foreign Exchange Regulation Act of India (FERA) and ensure that the RBI guidelines are strictly followed.
Recently, the Directorate General of Foreign Trade (DGFT) reduced the mandatory documents required for the import and export of goods to three documents each, simplifying the process. The mandatory documents for export are now the Bill of Lading/Airway Bill, Commercial Invoice cum Packing List, and Shipping Bill/Bill of Export. For imports, the mandatory documents are the Bill of Lading/Airway Bill, Commercial Invoice cum Packing List, and Bill of Entry.
This reduction in the number of mandatory documents leads to a corresponding reduction in transaction costs and time, facilitating the 'Ease of Doing Business' in respect of 'Trading across Borders' and improving India's ranking on this parameter.
To sum up, if you want to export jute products from India, obtain the necessary licenses and certificates, prepare the required documents, follow the regulations, and make use of the simplified mandatory document process. By following these guidelines, you'll be on your way to a successful export business.
8) Conclusion
In conclusion, exporting jute products from India can bring numerous benefits such as earning foreign exchange, generating employment opportunities, boosting the economy, and promoting the country's image globally. However, the process of exporting involves various complexities and requires extensive documentation and legal formalities.
To make the exporting process hassle-free, it is crucial to seek the assistance of a reliable export-import consultant. MHW Overseas is a trusted export-import consultant in India that offers end-to-end solutions for exporters of jute products. They provide comprehensive documentation support, find genuine buyers and suppliers, offer guidance on foreign exchange regulations, and ensure compliance with all legal formalities.
By partnering with MHW Overseas, exporters of jute products can focus on their core business activities while leaving the export-import procedures to the experts. This not only saves time and effort but also ensures a smooth and seamless export process.
Overall, exporting jute products from India can be a lucrative opportunity, and with the right partner like MHW Overseas, exporters can maximize their potential and expand their business globally.
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