This paper is basically based on the secondary data. The major source of data has been the Bangladesh Jute Mills Corporation (BJMC), the Bangladesh Jute Mills Association (BJMA), the Bangladesh Textiles Mills Corporation (BTMC), and the Bangladesh Textile Mills Association (BTMA). Various research reports, articles and relevant books were used as a source of data. The MIS division of BJMC was the primary source for the enterprise level as well as aggregate data for all jute mills. The International Jute Study Group (USG) provided a lot of support by giving data from their data base. The study was implemented through-trend analysis of available data on demographic variables, enrolment data, promotion, repetition and dropout data. The data were collected during the period March 2007 to December 2008.
Restructuring Jute Industries and Reform Policy Nationalisation Process of Jute Mills The jute sector was dominant in the country in terms of manufacturing output, employment and foreign earnings, which contributed 87 per cent of total merchandise export earning at the time of independence. The industry in the public sector became the property of Bangladesh after independence in 1971 while Pakistani mill owners (about 68 per cent of total looms) left the country leaving the industry in disarray and creating a managerial vacuum. In the year 1971-72, the Government adopted a policy of nationalisation and appropriated all abandoned jute mills including viable, vibrant and financially healthy jute industry. Since the late 1970s, the Government has implemented a number of reform programmes, which failed to produce tangible improvements because they narrowly focused on physical rehabilitation and financing restructuring of individual mills without addressing the industry level issues like tightly controlled policy, excess capacity and employment, pay increase in excess of productivity gains and mandatory credit to all mills. In addition, lack of operational autonomy, a rigid wage structure, controlled pricing policies, corruption and other problems turned the jute mills into money-losing enterprises. It may be noted that the number of officers and staff members was raised by about 35 per cent to 40 per cent above that in the pre-liberation period. Another round of increase in management personnel, by another 30 per cent to 40 per cent, took place after the violent political changes in the country in 1975, following a series of coups and counter-coups (Rahman and Hossain, 2003).
Privatisation in the Jute Manufacturing Industry After incurring huge losses and crippling the industry, the Government initiated the process of privatisation in July 1982 and ordered BJMC to complete denationalisation by 16 December under the advice of World Bank. At the end of the financial year 1981-82, there were 72 mills under the BJMC, immediately before the initiative of denationalization (Sobhan and Mahmood, 1991). During 1982-86, 34 of the 72 jute mills representing 47 per cent of the total jute manufacturing capacity were partially privatised with the Government holding minority share. Table 1 shows that out of these 34 privatised jute mills, 6 were composite, followed by 21 conventional and 7 carpet-backing cloth (CBC) jute mills. The minority shares varied from 6 per cent to 49 per cent averaging about 43 per cent of all privatized mills. In January 1991, the Government offered its minority shares in the private mills to the private sector (World Bank, 1992).
The process of privatisation (actual transfers) commenced in November 1982 and by the end of 1982, 18 mills had handed over to their erstwhile Bangladeshi owners. A further 10 mills were transferred during 01 January 1983 to 31 March 1983. The majority of the transfers were thus affected within 5 months of the initiation of the process. In all, 29 mills were handed over to private ownership by the end of 1982-83. A further 4 mills were privatized in 1983-84 and during 1984-85 one more CBC mill was denationalized. At the end of 1984- 1985, around 38 percent of all installed looms were in the private sector, and the remaining 62 percent were in the public sector (Sobhan and Mahmood, 1991). On the other hand, taking individual products, the private sector accounted for roughly 38 percent, 39 percent and 32 percent respectively of installed looms for producing hessian, sacking and CBC (Kikeri, 1997).