The finance minister announced exemption of jute particle board from excise duty along with other wood free particle boards. The move is meant to save the country's natural forest reserves rather than give an incentive to the jute industry.

However, finance minister Yashwant Sinha's announcement will boost the industry's diversification, much needed act for the ailing sector.

The manufacturers of jute particle boards are in the small-scale and unorganised sectors and are funded by the National Council for Jute Diversification which has been created by the Union government along with the United Nations under the recently concluded United Nation Jute Development Programme.

The production of jute particle boards constitutes less than half a per cent of the industry's total production. Therefore the effect of exciseduty exemption on the overall industry is anybody's guess.