Tears as jute mill shuts with 30,000 job losses

By Arshad Mahmud, The Guardian, Monday 1 July 2002

Amid tears and anger the authorities yesterday closed the shutters of Bangladesh's biggest jute mill in the face of mounting losses caused by inefficiency, mismanagement and corruption.

The closure of Adamjee jute mill in Narayanganj, about 14 miles south east of the capital Dhaka, has not only plunged nearly 30,000 employees into deep uncertainty but it has also brought an end to an era that was associated with the founding of the industry by a Pakistani industrialist in 1949.

The industry has already undergone huge upheaval. Jute, used to make rope, was once crucial to Scotland's economy, in particular Dundee which was once known for jute, jam and journalism. Now an entire township, Adamjeenagar, named after the Pakistani owner, is affected. Adamjee's jute mill was regarded as a success until it was nationalised after Bangladesh's independence in 1971. The mill began incurring losses after 1973, largely because of inefficiency and corruption by a nexus of union leaders and management.

Some economists and independent observers believe it was part of a conspiracy to “destroy the jute industry” by the international lobby aimed at making Bangladesh perpetually dependent on foreign aid. With 3,200 looms situated over an area of 300 acres of land the jute mill had become the largest not only in the then Pakistan but also in Asia.

“The mill has sustained a loss of more than taka 12000m (£150m) in the past 30 years,” said Hafizuddin Ahmed, the jute minister. “The nation is simply unable to carry the burden any more”.

Weeping workers and their families left the mill area in trucks, pick-ups and rickshaw vans with their belongings yesterday but they seemed to resent the government decision.

Fearing a backlash the authorities quickly deployed more than a thousand police and paramilitary forces to meet any violence.

The government has announced severance pay for regular workers.