The Cabinet Committee on Economic Affairs (CCEA) on Tuesday approved the Minimum Support Price (MSP) for raw jute at ₹5,925 per quintal for the 2026-27 marketing season, which is 4.9 per cent higher than ₹5,650 per quintal fixed for 2025-26 season.
The decision will benefit jute growers, especially in West Bengal and Assam, Information and Broadcasting Minister Ashwini Vaishnaw told reporters after the cabinet meeting.
Stressing that India is one of the largest producers of raw jute in the world, the government said that the approved MSP, fixed for TD-3 grade raw jute, will ensure a return of 61.8 per cent over the all-India weighted average cost of production (of ₹3,662/quintal A2+FL) to the growers.
It is in line with the government’s principle of fixing MSP at least 1.5 times the all-India weighted average cost of production since 2018-19. However, based on the projected C2 cost production of ₹4,945/quintal, the new MSP is 19.8 per cent more.
MSP expenses
Farmer leaders have been demanding the government to fix the MSP on the Swaminathan Commission formula of C2+50 per cent.
The MSP amount paid to jute-growing farmers in 2014-15 to 2025-26 stood at ₹1,342 crore compared with ₹441 crore paid during 2004-05 to 2013-14, an official statement said.
The Jute Corporation of India (JCI) will continue as the central government’s nodal agency to undertake Price Support Operations. Any losses incurred in selling those procured jute will be fully reimbursed by the central government, it said.
Recommending the MSP to the government, the Commission for Agricultural Costs and Prices (CACP) has pointed out that the jute production estimates by Ministry of Agriculture and the
Jute Advisory Board/Expert Committee on Jute significantly differ from each other, which adversely affects decision-making, including price policy recommendations and businesses.
“Although divergence has narrowed in recent years but is still high,” the CACP said in its report reiterating its earlier recommendation of constituting an Expert Committee to examine this long-pending issue.
Concern of dipping acreage
The Commission has also expressed concern over the declining acreage of jute as result its production has also declined during last two and a half decades. “Though yield has improved, but there are wide inter-and intra-State variations in productivity. Average yield in Assam and Bihar is significantly lower than West Bengal and all-India level,” it said.
The Commission has suggested strategic interventions and supportive policies, focusing on expanding area under jute, through an integrated approach to mitigate potential risks and addressing challenges.
The CACP has also asked the government to gradually reduce the compulsory use of jute packaging material for ensuring availability of raw jute for diversified jute goods.
There are several orders under the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act, 1987, prescribing either full or a minimum per cent (as high as 90 per cent) in commodities like paddy, wheat and sugar.
It has further said that premium for TD-1 and TD-2 and discount for TD-4 and TD-5 varieties should be increased in relation to MSP of TD-3.
Stating that India is a net importer of raw jute but net exporter of jute products, the CACP has said that various export incentives by Bangladesh, the largest exporter of jute and jute goods, adversely affect Indian jute farmers and industry.
“In order to protect farmers and industry from unfair competition, there is a need to monitor imports of jute and jute goods and take corrective measures to restrict subsidised imports from Bangladesh and other neighbouring countries,” it said. Besides, as USA is a key market for Indian jute products, and recent tariff hike has created uncertainty, there is a need to mitigate such risks by diversifying jute products export basket and markets, it said. India’s top-5 export destinations account for 50-70 per cent of exports of various jute goods.
Published on February 24, 2026