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, 4.9 per cent higher than ₹5,650 per quintal set for the 2025-26 season.
Information and Broadcasting Minister Ashwini Vaishnav told reporters after the cabinet meeting that this decision will especially benefit jute growers in West Bengal and Assam.
Emphasizing that India is one of the largest producers of raw jute in the world, the government said the approved MSP fixed for TD-3 grade raw jute will ensure a return to growers of 61.8 per cent on the all-India weighted average cost of production (₹3,662/quintal A2+FL).
This is in line with the government’s principle of fixing the MSP at at least 1.5 times the all-India weighted average cost of production from 2018-19. However, based on the estimated C2 cost of production at ₹4,945/quintal, the new MSP is 19.8 per cent higher.
MSP expenditure
Farmer leaders are demanding the government to fix the MSP at Swaminathan Commission’s formula C2+50 percent.
The MSP amount paid to jute-growing farmers in 2014-15 to 2025-26 was ₹1,342 crore, compared to ₹441 crore paid during 2004-05 to 2013-14, an official statement said.
Jute Corporation of India (JCI) will continue to be the nodal agency of the Central Government for price support operations. It said that any loss incurred in selling the purchased jute will be fully compensated by the Central Government.
While recommending the MSP to the government, the Commission for Agricultural Costs and Prices (CACP) has pointed out that the estimates of jute production by the Ministry of Agriculture and
The Jute Advisory Board/Expert Committee on Jute differ significantly from each other, which adversely impacts decision making including price policy recommendations and businesses.
In its report, the CACP said, reiterating its earlier recommendation to set up an expert committee to examine the long-pending issue, “the differences, though narrowing in recent years, still remain high.”
Concern about decreasing area
The Commission has also expressed concern over the declining area under jute, which has resulted in a decline in its production during the last two and a half decades. “Although yields have improved, there are inter-state variations in productivity. The average yield in Assam and Bihar is significantly lower than West Bengal and the all-India level,” it said.
The Commission has suggested strategic interventions and supportive policies focusing on expansion of area under jute through an integrated approach to mitigate potential risks and address the challenges.
CACP has also asked the government to gradually reduce the mandatory use of jute packaging material to ensure availability of raw jute for diverse jute goods.
There are several orders under the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act, 1987, which prescribe the absolute or minimum percentage (up to 90 per cent) in commodities like paddy, wheat and sugar.
It further states that the premium for TD-1 and TD-2 and rebate for TD-4 and TD-5 varieties with respect to MSP of TD-3 should be increased.
Stating that India is a net importer of raw jute but a net exporter of jute products, the CACP said various export incentives by Bangladesh, the largest exporter of jute and jute goods, adversely impact Indian jute farmers and the industry.
“To protect farmers and industry from unfair competition, there is a need to take corrective measures to monitor imports of jute and jute goods and restrict subsidized imports from Bangladesh and other neighboring countries,” it said. Moreover, since the United States is a major market for Indian jute products, and the recent tariff increase has created uncertainty, there is a need to mitigate such risks by diversifying the export basket and markets of jute products, it said. India’s top-5 export destinations account for 50-70 percent of exports of various jute goods.
Published on February 24, 2026
