सं Samvidhan

The Constitution of India

Article 273

Grants in lieu of export duty on jute and jute products

Why this exists

Before independence, jute (grown mainly in Bengal and neighboring regions) was a major export earner, and export duties on it were an important revenue source shared with jute-growing provinces. When the Constitution centralized fiscal powers, the framers created this special transitional arrangement so that jute-producing states wouldn't lose out on revenue they previously depended on, while allowing the central government flexibility to eventually phase out export duties on jute without leaving these states short-changed overnight.

Common misconceptions
  • Myth: Article 273 gives these states a permanent right to jute export revenue.
    Fact: The grants were time-limited — capped at ten years from the Constitution's commencement or until the jute export duty itself was withdrawn, whichever happened first.
  • Myth: The Article applies to any state that grows jute.
    Fact: It specifically names only Assam, Bihar, Orissa and West Bengal, not any other jute-growing region.