India’s GDP is within the striking distance of attaining positive growth, the Reserve Bank said observing that the letter “V” in the V-shaped recovery stands for vaccine. The Indian government launched the world’s biggest vaccination drive on January 16 to protect people from COVID-19.
“What will 2021 look like? The shape of the recovery will be V-shaped after all and the ‘V’ stands for vaccine,” said an article on the ‘state of economy’ in the RBI’s January Bulletin.
India has launched the biggest vaccination drive in the world, backed by its comparative advantage of having the largest vaccine manufacturing capacity in the world and a rich experience of mass inoculation drives against polio and measles.
“If successful, it will tilt the balance of risks upwards,” said the authors who among others include RBI Deputy Governor Michael Debabrata Patra.
The RBI, however, said the views expressed in this article are those of the authors and do not necessarily represent the views of the central bank.
E-commerce and digital technologies will likely be the bright spots in India’s recovery in a world in which there will be rebounds for sure, but pre-pandemic levels of output and employment are a long way off, they said.
The article further said: “Recent shifts in the macroeconomic landscape have brightened the outlook, with GDP in striking distance of attaining positive territory and inflation easing closer to the target.”
India’s GDP is estimated to contract by a record 7.7 per cent during 2020-21 as the COVID-19 pandemic severely hit the key manufacturing and services segments, as per government projections released earlier this month.
The economy contracted by a massive 23.9 per cent in the first quarter and 7.5 per cent in the second quarter on account of the COVID-19 pandemic.
The article further said that in the first half of 2021-22, GDP growth will benefit from statistical support and is likely to be mostly consumption-driven.
With rabi sowing surpassing the normal acreage way before the end of the season, bumper agriculture production is expected in 2021.
“India being the global capital for vaccine manufacturing, pharmaceuticals exports are expected to receive a big impetus with the start of vaccination drives globally. Agricultural exports remain resilient and under the recent production linked (PLI) scheme, food processing industry has been accorded priority,” it said.
Harnessing the synergies by transforming low-value semi-processed agri products through food processing would not only improve productivity but also boost India’s competitiveness, it added.
The article notes that slippage ratios have been falling and loan recoveries are improving even as provisioning coverage ratios have risen above 70 per cent. Capital infusion and innovative ways of dealing with loan delinquencies will occupy policy attention in order to ensure that finance greases the wheels of growth on a durable basis before the demographic dividend slips away.
“It will take years for the economy to mend and heal, but innovative approaches can convert the pandemic into opportunities. Will the Union Budget 2021-22 be the game-changer?,” it said.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget in Lok Sabha on February 1.
Source: The Financial Express
India's GDP is within the striking distance of attaining positive growth, the Reserve Bank said observing that the letter "V" in the V-shaped recovery stands for vaccine.
The Indian government launched the world's biggest vaccination drive on January 16 to protect people from COVID-19.
"What will 2021 look like? The shape of the recovery will be V-shaped after all and the 'V' stands for vaccine," said an article on the 'state of economy' in the RBI's January Bulletin.
India has launched the biggest vaccination drive in the world, backed by its comparative advantage of having the largest vaccine manufacturing capacity in the world and a rich experience of mass inoculation drives against polio and measles.
"If successful, it will tilt the balance of risks upwards," said the authors who among others include RBI Deputy Governor Michael Debabrata Patra.
The RBI, however, said the views expressed in this article are those of the authors and do not necessarily represent the views of the central bank.
E-commerce and digital technologies will likely be the bright spots in India's recovery in a world in which there will be rebounds for sure, but pre-pandemic levels of output and employment are a long way off, they said.
The article further said: "Recent shifts in the macroeconomic landscape have brightened the outlook, with GDP in striking distance of attaining positive territory and inflation easing closer to the target."
India's GDP is estimated to contract by a record 7.7 per cent during 2020-21 as the COVID-19 pandemic severely hit the key manufacturing and services segments, as per government projections released earlier this month.
The economy contracted by a massive 23.9 per cent in the first quarter and 7.5 per cent in the second quarter on account of the COVID-19 pandemic.
The article further said that in the first half of 2021-22, GDP growth will benefit from statistical support and is likely to be mostly consumption-driven.
With rabi sowing surpassing the normal acreage way before the end of the season, bumper agriculture production is expected in 2021.
"India being the global capital for vaccine manufacturing, pharmaceuticals exports are expected to receive a big impetus with the start of vaccination drives globally. Agricultural exports remain resilient and under the recent production linked (PLI) scheme, food processing industry has been accorded priority," it said.
Harnessing the synergies by transforming low-value semi-processed agri products through food processing would not only improve productivity but also boost India's competitiveness, it added.
The article notes that slippage ratios have been falling and loan recoveries are improving even as provisioning coverage ratios have risen above 70 per cent. Capital infusion and innovative ways of dealing with loan delinquencies will occupy policy attention in order to ensure that finance greases the wheels of growth on a durable basis before the demographic dividend slips away.
"It will take years for the economy to mend and heal, but innovative approaches can convert the pandemic into opportunities. Will the Union Budget 2021-22 be the game-changer?," it said.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget in Lok Sabha on February 1.
Source: The Economic Times
Barring another wave of COVID-19 infections, the worst is over for India's economy and policymakers may soon have more room to support a recovery, the central bank said in its January bulletin released on Thursday.
"Recent shifts in the macroeconomic landscape have brightened the outlook, with GDP in striking distance of attaining positive territory and inflation easing closer to the target," the Reserve Bank of India (RBI) said in an article on the state of the economy.
"If these movements sustain, policy space could open up to further support the recovery," it added.
The RBI slashed interest rates early last year to cushion the shock from the coronavirus crisis, but has left rates unchanged in recent months, cautious of rising inflation.
The RBI expects Asia's third-largest economy to contract by 7.5% in the current fiscal year to March, but analysts believe it is likely to escape recession and see modest growth in the current quarter. Growth will be mostly consumption driven, the RBI said.
The need to kickstart investment is growing more urgent to secure a durable turnaround and a sustainable growth trajectory, the RBI said.
It also added that the cash sitting idly on the balance sheet of companies and banks and the funds parked with it at the reverse repo must find their way towards productive sectors and into real spending on investment activity, before it imposes a persistent deflationary weight on activity.
The RBI said stress on financial sector balance sheets could increase, but banks are in a better position now than they were during the 2008 global financial crisis.
It also noted a "vigorous resumption" of government spending which acts as an important growth driver when all other components of GDP are in deep retrenchment due to the pandemic.
"Recent high frequency indicators suggest that the recovery is getting stronger in its traction and soon the winter of our discontent will be made glorious summer," the RBI wrote, quoting William Shakespeare.
Source: The Economic Times
In the run-up to the upcoming Union Budget, the Confederation of India Industry (CII) has sought exemption from customs duty to the private sector along the lines of the concession offered to defence public sector undertakings and ordnance factories for importing systems and equipment for manufacturing military equipment.
In its pre-budget recommendations for the defence sector, the industry body on Thursday said while the customs duty and other taxes are reimbursed to the industry on completion of the contract, a significant chunk of money gets blocked during the duration of the contract.
Currently, customs duty and Integrated Goods and Services Tax account for 31% of the value of imports in taxes. “Indirectly, it is an additional cost that the private industry has to bear vis-à-vis DPSUs and ordnance factories,” the CII said in a statement.
The industry body said the taxes were affecting the private sector’s competitiveness across all projects, especially “large value, long-gestation period” programmes such as shipbuilding.
The CII said it was critical to restore the level playing field for the private industry as was prevalent before a February 2020 amendment.
“It is discriminatory that the DPSUs are exempt from the customs duty while the private sector has to make upfront payments. It causes cash flow problems. Restoring the level playing field and creating a balance would be the right thing to do,” said Colonel KV Kuber (retd), director, aerospace and defence advisory, Ernst & Young.
In another recommendation, the CII asked the government to harmonise the GST rates for different types of war-fighting platforms for ease of doing business. “Warships, submarines and aircrafts are subject to 5% GST. However, most of army’s war-fighting equipment and systems see the incidence at 18%,” the CII said.
“The Society of Indian Defence Manufacturers wishes to seek your (government’s) consideration for its proposal to harmonise the GST rates for war-going apparatus of the armed forces that sees incidence of GST that varies from 5% to 12% to 18% depending on the category,” the statement said.
The GST on the entire range of war-fighting equipment of the armed forces and the para military must be harmonised and zero rated on par with exports, possibly considering these as deemed exports, the industry body recommended.
Source: The Hindustan Times
Union budgets that follow economic crises tend to emphasise policy support for growth, especially for stressed sectors. The upcoming budget, too, is expected to prioritise growth over fiscal concerns. Some landmark reforms introduced last year in agriculture, manufacturing and services are clear indicators of GoI’s commitment to reforms. This process must continue in 2021 with equal vigour.
First, the agricultural reforms are potentially transformational. For long, economists and policymakers have lamented the lack of political will to reform this sector. But that changed last year. Even with GoI’s proposal that it suspends the three farm laws for a year-and-a-half, the fact remains that these reforms can help create a national market for farm produce, catalyse opportunities in food processing, propel investments in cold-chains and warehouses, and create avenues for higher farm incomes
Such outcomes can be achieved with efforts to strengthen the collective bargaining power of farmers. For instance, State-support to farmer producer organisations (FPOs) can enable farmers to leverage economies of scale. Farmers also face large deficits in access to institutional capital. A remedy is to define FPOs as MSMEs. GoI can help farmers get better prices for their produce through redoubled support for development of commodities markets. Forward markets for agricultural products can help farmers hedge prices and manage seasonal risks.
Farm productivity — the Achilles heel of Indian agriculture — can also benefit from focus on digitalisation. For instance, an agriculture information stack that can collect, process and disseminate crucial information on the farms and crops, can prove useful.
Second, a competitive manufacturing sector is a critical pillar for economic revival. Innovative policy frameworks such as the production linked incentive (PLI) and phased manufacturing programme (PMP) are steps in the right direction.
Efforts to improve ease of doing business (EoDB) must now be accompanied with focus on reducing the cost of doing business (CoDB). States may be ranked on CoDB parameters, and goals for reduction of such costs are set.
For instance, cross-subsidy in power and railway freight should be minimised. Land should be made available at reasonable costs through creation of land bank corporations at the Centre and states. Investments in industrial and logistics infrastructure should be accelerated.
Projects under the National Infrastructure Pipeline (NIP) should be front-ended, with a target of 50% completion in the next two years.
As per a December 2020 Federation of Indian Chambers of Commerce and Industry (Ficci)-Dhruva Advisors survey, 69% of respondents foresee a sizeable shift in global manufacturing from China to India in the near future. However, scale is a prerequisite for Indian firms to account for a greater share of value in global supply chains. Low-cost credit can drive such expansion.
The cost of financial intermediation in India is prohibitive, and the banking sector must become more competitive. A national asset management company, or ‘bad bank’, for one-time resolution of large non-performing assets must be considered. The time is also ripe to convert well-governed non-banking financial companies (NBFCs) into full-fledged universal banks and let large corporate and industrial groups to enter banking.
GoI may also consider setting up a development finance institution, similar to the National Investment and Infrastructure Fund (NIIF), to finance mid-sized companies. Such an institution can raise money from sovereign wealth funds and other long-term institutional investors.
Finally, services —tourism, hospitality, retail, media and entertainment —were among the worst-affected by Covid-19. They need urgent State support, too. While the vaccination drive is expected to reinvigorate demand in these sectors, the Union budget should include targeted fiscal interventions to support discretionary spending by citizens.
Education and healthcare need radical transformation. The roll-out of new National Education Policy (NEP) is an important foundation that can encourage private participation. Additional interventions should include reform of fee structures at higher educational institutes (HEIs), in line with market determined rates. Healthcare infrastructure can also undergo a revamp with State support.
Public spend on healthcare must be stepped up to at least 0.5% of GDP every year for the next five years. Tax benefits can be provided to the private sector on capital expenditure and skill development spends to mitigate Covid’s fallout.
Source: The Economic Times
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The offerings of the aforementioned firms hold more relevance especially at times when the needs of the textile value chain continue to change with growing emphasis on innovative products, better agility and speed to market.
With their rich industry experience and upfront approach to support the apparel industry in operations, the companies can help make some meaningful contribution to the industry and that’s why they are here.
So, if you haven’t met them or haven’t been at ASW Marketplace as yet, then register yourself here now and be a part of this never-before-seen world.
Source: Apparel Online
The Reserve Bank of India (RBI) continued to remain a net buyer of the US currency in November after it bought USD 10.261 billion from the spot market, data showed.
During the reporting month, the central bank purchased USD 14.289 billion and sold USD 4.028 billion, according to the monthly bulletin released by the RBI for January.
In October this year, though the RBI had purchased USD 15.64 billion from the spot market, it did not sell the US currency.
In November 2019, the RBI had bought USD 7.458 billion and sold USD 530 million in the spot market.
In FY20, the central bank had net purchased USD 45.097 billion. It had bought USD 72.205 billion and sold USD 27.108 billion in the spot market.
In the forward dollar market, the outstanding net purchase at the end of November was USD 28.344 billion, compared to USD 13.556 billion in October, the data showed.
Source: The Financial Express
Necessity drives innovation. The need for transport led to the invention of the wheel. The need for mass production led to the invention of electricity. And the need to decipher encrypted messages in the war led to the invention of the computer. The recent COVID-19 pandemic has created a similar necessity to innovate and overcome its myriad challenges – from delivering vital services like education to developing a vaccine in the shortest possible time. To some extent, the global community has managed to meet these demands to tackle the pandemic, but the long-run repercussions of the pandemic will persist. So, the need to innovate remains stronger than ever.
India has been exemplary on this front. Over the last decade, it has made significant progress in establishing itself as a hotbed for innovation. With 21 unicorns valued around $73 billion, India is the third-largest start-up ecosystem in the world. And the success of the ISRO’s Mars Orbiter- Mangalyaan - at the cost of $74 million - is not only an example of stunning affordability but also of India’s technological prowess. Unsurprisingly, India climbed into the top 50 innovative nations in the world in 2020 on the Global Innovation Index (GII) from a rank of below 80 in 2015.
However, despite such a strong performance on GII, the country underperforms on certain key parameters that drive innovation. First, India’s spending on research and development (R&D) stood around 0.64 percent in 2018-19. While this level of spending is far behind advanced economies like Israel that spend almost 5 percent of their GDP on innovation, it also falls behind developing economies like Brazil (1.2 percent) and Russia (0.98 percent). Second, India also lags on another crucial aspect of innovation, which is the proportion of people engaged in R&D. While India has about 253 researchers per million people, countries like Denmark and South Korea have around 8000 researchers per million. Lastly, unlike most nations, the bulk of the Indian R&D expenditure comes from the government sector. The government’s share in R&D expenditure accounts for about 57 percent. While the same figure stands at 1.5 percent for countries like Israel. The private sector has been less proactive in India in driving R&D upwards.
These statistics warrant studying the Indian innovation ecosystem in greater detail. Given the vastness of the country where each region has its unique strengths and weaknesses, it is instructive to delve into a state-wise performance of the country on innovation. Keeping this in perspective, NITI Aayog has published the second edition of the India Innovation Index in partnership with Institute for Competitiveness. The index aims to capture the performance of Indian states on various parameters that drive innovation. The idea is to identify the factors that enable innovation across regions and build upon the learnings to address the weaknesses in other regions. There are a few broad learnings that can be made from the index.
First, on an average, Indian states score 23.4 out of a maximum of 100. The score shows the immense scope for improvement that remains for the country in terms of innovation. On an average, the best performing pillars on the index are the Safety and Legal Environment and Human Capital while the most concerning pillar is Investment, which includes the expenditure of state governments on R&D among other indicators.
Second, the index shows that the southern states of the country perform better than the rest of the country on innovation. In fact, the top five major states in the rankings are all from southern India. A leading reason for the superior performance of this region on innovation is the massive pool of talent in these states due to their historical legacy of investments in higher education. Additionally, these states also command the bulk of the investment in innovative activities through venture capital deals and foreign direct investment.
Finally, the pillars of the index have been segregated into the Enablers and Performance dimensions. The former captures pillars that drive the innovation capabilities of regions while the latter encapsulates the outcomes achieved by leveraging those capabilities. The index shows that the states that have performed better on Enablers have also performed better on Performance. This implies that investing in enabling factors of innovation ensures improved performance on innovation outcomes.
The learnings from the index are only a macroscopic view on innovation across Indian states. It is a crucial tool to obtain a broad judgement on where regions stand with respect to various facets of innovation. Therefore, while the index can help policymakers make improved policy choices on enhancing the innovative capacities across regions, each state needs to work towards addressing its own set of unique challenges. The recovery of the Indian economy in the post-COVID world rests on how it leverages innovation in the coming years.
Source: The Economic Times
SupplyCompass, the production platform for brands and manufacturers, rolls out a major update of in-built Slack-style chat to its existing solution.
The new tool aims at streamlining communication between the fashion retailers and manufacturers.
The easy communication will help improve transparency and reduce the market time while also delivering better quality products. The fashion brands can also use the tool to connect to new manufacturers’ network when they need new manufacturing partners.
With the update, the businesses can onboard their own factories and suppliers onto the platform, therefore establishing better collaboration and also providing them the ability to manage their whole supply chain network via a single source of truth.
This level of collaboration will further assist in better production management and allow intelligent utilisation of time for other processes.
Furthermore, the chat feature will allow uploading of heavy files directly into the chat, eliminating any restrictions on file size like email.
This will enable real-time conversation with factories saving all the conversation being saved in the single thread to keep the relevant information about an order in the same place.
It also supports sharing of videos, embed links and use of emojis to bring personality and humanness to messaging, and nurture the partner relationship.
Source: Apparel Online
A massive asset-monetisation drive is one of the options suggested by experts to the government to raise funds for investment in infrastructure. Several transactions of strategic divestment and key public offers that began in the current financial year are likely to spill over to the next financial year, giving a lift to disinvestment proceeds.
This asset-sale programme, along with the new public sector enterprise policy, will guide the disinvestment policy for FY22.
Source: The Economic Times
Top Bharatiya Janata Party (BJP) leaders met at Union minister Rajnath Singh’s residence on Wednesday to discuss the strategy for parliament’s Budget Session from January 29. The party is preparing to face a belligerent Opposition seeking to corner the government on the farm laws, the Chinese aggression and the leaked WhatsApp messages of Republic TV editor-in-chief Arnab Goswami.
Prime Minister Narendra Modi will chair an all-party meeting virtually on January 30. The Opposition’s demands and the government’s legislative plans for the session are expected to be discussed at the meeting. All party meetings are customary affairs before every parliament session.
A BJP functionary said the Opposition will raise the issue of protests against the three farm laws passed in September even as the government has maintained repeatedly that they benefit the farmers and that the provisions of the legislation were suggested by several parties including the Congress.
“The Congress has been misleading the farmers by alleging that the laws will benefit cooperates but the truth is that they themselves had made similar suggestions such as abolishing the APMC [Agricultural Produce Market Committee] Act when they were in power,” said the functionary, who did not want to be named.
Union ministers S Jaishankar, Ravi Shankar Prasad, Pralhad Joshi, and Thawar Chand Gehlot were among others who attended the meeting.
The Congress has said it will raise the issue of Goswami’s chats during the session. The opposition has suggested the leaked messages point to collusion and leak of classified security information. The Congress has accused Modi and top ministers of violating the Official Secrets Act and demanded a probe and action against those who allegedly leaked sensitive information to Goswami.
Source: The Hindustan Times
Budget 2021 is being presented under exceptional conditions.
This is borne out from the advance estimates that show India’s GDP growth to contract by 7.7% in 2020-21, the worst in four decades. The reverberations of this are being felt on lives, livelihood and growth.
GoI has been quick to react with targeted measures to arrest this fall. Under the circumstances, Finance Minister Nirmala Sitharaman should unravel a pragmatic budget. One expects that it would delineate a policy plan that revitalises growth drivers, alleviates distress, supports livelihoods and helps create a resurgent India that is both inclusive and self-sustaining.
The need for fiscal support to lift the economy is paramount. Hence, GoI should relax fiscal consolidation for a year, and announce a realistic fiscal deficit target for FY2022. Further, the deficit should be seen from the longer perspective of 3-4 years, and not be a one-year outlook. There is a need to go for a ‘fiscal deficit range’, instead of a fixed fiscal deficit target, as well as improve the quality of deficit by including off-budget liabilities, and ensuring greater transparency in budget numbers.
At the same time, a clear roadmap should be delineated for a return to the path of fiscal consolidation, depending on the rate of economic recovery. Such an approach sets the template for growth, resulting in smaller deficits in the future.
Second, the space gained by expansionary fiscal policy should be utilised to enhance capital expenditure targeted towards areas that have a high multiplier effect. GoI should fast-track existing infrastructure projects underway, rather than go for new ones. It should notify the shelf-ready projects, which are in the National Infrastructure Pipeline (NIP), for implementation. It would crowd-in private investment and kick-start a virtuous cycle of revenue, job-creation and private investment.
With the Covid-19 pandemic having revealed India’s health infrastructure inadequacies, Sitharaman would do well to increase allocations for healthcare. The 2017 National Health Policy pledges to increase public spending for healthcare to at least 2.5% of GDP by 2022, from the current 1.5%. The budget must work towards this target.
A direct demand-inducing measure is for the government to speedily release all outstanding payments or tax refunds owed to service providers in the form of pending bills. This includes goods and services tax (GST) refund dues. These could be small or large companies, state governments, etc.
Third, resources for capital expenditure can be raised in several ways, including public sector undertaking (PSU) disinvestment and strategic sales. Another model to generate funds would be monetisation of land and other assets owned by government or PSUs. It is also important to seriously consider expenditure rationalisation to free up the fiscal space.
Fourth, GoI should also take steps to rejuvenate public sector banks (PSBs) by bringing down its stake to below 50% through the market route over the next 12 months. This should be done for all except 3-4 financially strong banks such as the State Bank of India (SBI), Bank of Baroda and Union Bank. Further, steps like creating multiple bad banks, creating development financial institutions, and creating an agency for investigating financial sector frauds are much needed.
Fifth, in the matter of employment and exports, GoI should ensure speedy creation of jobs, considering the distress caused by the pandemic. For employment generation, there is a need to raise the cap to `50,000 to become eligible for 30% deduction on emoluments paid to new employees for three years. Enhancing allocation under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme, job stamps scheme for urban employment, addressing skill gaps, etc, should be key considerations.
The export market is a key driver of employment generation, and should be leveraged through a policy that supports greater participation in the global value chains (GVC). This would be possible by bringing down import tariffs, which would help us exploit — and benefit from — global markets.
Source: The Economic Times
Venkaiah Naidu, Vice President of India, has said that the Indian apparel exporters must aim to capture double-digit share of the world apparel market from its current level of 5-6 per cent through upskilling and use of latest technologies.
Addressing an event, he said, “We should soon aspire to reach a double-digit share in export of fabrics with proper encouragement and branding.”
He insisted that skilled manpower, more than cheap labour, should be Indian apparel manufacturing industry’s strength.
He further added that the sector should ponder over the reasons why India, despite being the leading producer and exporter of cotton, jute, silk and MMF yarns, lacks the competitive edge in fabrics and apparels when compared to Bangladesh and China.
“They are the biggest buyers of Indian yarn. They add value to it and sell the fabrics and apparels at a lower cost than India. This is largely due to the unorganised and dispersed nature of the weaving sector in India. We need to have more Tirupurs,” he said.
Source: Apparel Online
India Inc is eyeing a demand push from Budget 2021-22, along with an increased outlay for infrastructure and social sector projects, according to a private survey.
The budget should also continue with the Centre’s policy focus on strengthening the manufacturing sector while promoting research and development (R&D) and incentivising new technologies, said the Federation of Indian Chambers of Commerce and Industry (FICCI)-Dhruva pre-budget survey released on Wednesday.
“The budget must prioritise growth-oriented measures over fiscal considerations. It must focus on employment generation and on putting more money in the hands of consumers – the twin engines that will boost demand and drive growth,” said Uday Shankar, president of FICCI.
About 80% of survey participants felt the key policy thrust of the government should be on the manufacturing sector while 61% pushed for improvements in the ease of doing business to strengthen the sector.
“Improving the ease of doing business, including ease of administration of the tax regime, are the key asks of the industry to promote India as a global manufacturing hub,” said Dinesh Kanabar, CEO of Dhruva Advisors.
As for boosting goods and services tax (GST) revenue, about 90% of the survey participants said that enhancing economic activity through greater consumption and investment demand should be the government's focus.
This objective could be achieved through tax incentives aimed at personal tax relief, according to 40% of the participants while 47% said a widening of tax slabs would be the ideal measure to boost demand.
Further, 75% of those surveyed said that tax incentives could be used to boost employment generation.
In terms of challenges being faced by businesses, 52% respondents said timely receipt of refunds was a major issue while 61% called for a specific time frame for tax refunds to revive businesses.
Source: The Economic Times
Datacolor, a leader in colour management solutions, unveils Spectro 1000/700 series – a family of close-tolerance benchtop spectrophotometers, which delivers high efficiency in colour formulation and quality control in various industries.
The new series is designed to give Datacolor customers uniformity of colour assessments across various instruments and multiple locations throughout the supply chain.
Besides, it also increases the productivity and improves workflow efficiency by delivering high measurement speed and seamless backward capability with other Datacolor benchtop instruments.
The new series also comes with the ability to capture the temperature of samples measured giving greater confidence in their colour measurements.
It is a new quality control feature that allows the users to work with materials that need to be within certain range of temperature to assure accurate colour measurement.
Source: Apparel Online
Bitcoin transactions, among other functions, have existed in India since the inception of the foremost cryptocurrency in 2009. But as its use became more widespread, it was met with cynicism and hostility from governing bodies like the RBI, especially in 2018. However, the position could not be maintained for too long.
Central Banks all around the world had been issuing their own cryptocurrencies — some of them declared them to be legal tender and the rest took a wait-and-see approach. Owing to global trends in favour of cryptocurrencies, an obligation to protect human rights and on the basis of proportionality, the Supreme Court overturned the 2018 ban on crypto asset trading in March, 2020.
“When the consistent stand of RBI is that they have not banned virtual currencies and when the government of India is unable to take a call despite several committees coming up with several proposals, including two draft bills, both of which advocated exactly opposite positions, it is not possible for us to hold that the impugned measure is proportionate," the top court had said.
But there are other reasons why Indian authorities eventually had to concede to the rising popularity and public demand for bitcoin and the cryptocurrency industry as well. Virtual currencies enabled millions of Indians to participate in the global ecosystem of cryptocurrencies. They made transactions for Indians to any part of the world simpler, quicker and more cost-effective and empowered Indians to make informed choices on investing in one of the world’s highest performing assets. While in 2020 many industries crumbled, the crypto industry created thousands of jobs and helped employees retain their jobs and upskill.
There is a fair amount of hype around bitcoin when the prices are bullish. However, it is important to bear in mind that what gives bitcoin its value is its ability to enable fast and free transactions. Just as email communication made the transfer of information fast and free, technology like bitcoin has the potential to revolutionise money.
As of now, this has been seen as quite a speculative instrument but this is still a phase that it had to undergo to discover its own value so that it can be used for “value transfer” mechanism in the future generations. Moreover, we need to remember that most developed countries have stable currencies and the common public generally live on credit. But in India, the native fiat currency depreciates faster and there is a strong instinct to save among our population. This combined with the rise of digitisation and technical savviness of the younger generation makes the technology of bitcoin very useful for us.
The cryptocurrency industry is thus here to stay and it is essential to facilitate its advance, especially in the economic downturn brought about by the pandemic. The RBI, along with SEBI and the government of India, should consider exercising its regulatory powers and come up with a new, calibrated framework or regulation that acknowledges the reality of these technological advancements. We must take this opportunity to keep India on the front foot with other leading global economies and assure investors and stakeholders of the continuity in the business.
Here are a few things that the Union Budget should consider in granting greater regulatory clarity to cryptocurrencies in India:
While it may not be possible to bring out all these rules at once, some kind of road map would be necessary. This would help the country on multiple levels, whether in investment opportunities, employment or innovation. If such a legislation is announced, India will join the ranks of the countries to bring a robust regulatory framework to crypto assets and will be able to compete with developed countries in this industry.
Source: The Economic Times
The Indian economy is undergoing a "V-shaped recovery" and the world is watching the same in surprise, Union Home Minister Amit Shah said on Thursday.
Shah, one of the senior most members of the cabinet, also said the COVID-19 vaccination drive is progressing well and once everyone is vaccinated, "we will attain victory over the pandemic".
He made the comment while joining through vide- conference the inauguration of a four-lane over-bridge in Shilaj here by Gujarat Deputy Chief Minister Nitin Patel.
"Economies of all countries in the world were affected due to the coronavirus. But, the world is surprised and watching the V-shaped recovery of the Indian economy," Shah said.
The GDP contracted by 23.9 per cent in the June 2020 quarter due to the lockdown, and the contraction narrowed down to 7.5 per cent in the September quarter as compared to the same in the year-ago period, as the unlock process began.
The demand situation has shown further improvement in the December quarter which witnessed the festivities, with several high-frequency indicators illustrating the same.
The Union government now expects the GDP to close FY21 with a contraction of 7.7 per cent.
Shah also said that infrastructure development carried out under the Narendra Modi regime in the last six years exceeds that done by governments in the 20 years preceding the NDA government.
"The work done in the infrastructure sector in last six years is equivalent to that done in 20 years of previous governments," he said.
He listed various infrastructure works like Metro lines, bullet train and other projects taken up by the Centre.
He said Prime Minister Narendra Modi's government is working hard to develop infrastructure in the country, be it rural or urban areas.
The Modi government has provided electricity to all villages of the country, road connectivity, and has provided one bank account to every family.
"Ten crore families, or 30 crore people, in India were not having their own houses, and the way construction of houses for low income groups is going on, we are confident that every family will get a home by 2022," Shah said.
"Another big project that we have taken up is providing piped water to every household by 2022," he said.
Shah said the government has also taken up the work of removal of one lakh railway crossings on national and state highways by building over-bridges or under-bridges on them. The work on around 5,000 such crossings has been completed and it is currently on in 8,000 other places, he said.
"The Shilaj bridge (inaugurated here on Thursday) is one such among the one lakh bridges (being built) on the railway crossings," he said.
Source: The Business Standard
Soon textile industry may get a solution for increased raw material prices as the Government has indicated to come up with few measures in this regard.
Nitin Gadkari, Union Minister for MSMEs, has said that the Union Government is looking at measures to control raw material prices.
He was interacting with the industry stakeholders in Coimbatore after inaugurating a virtual Foundry Conclave organised jointly by the Confederation of Indian Industry (CII) and the Institute of Indian Foundrymen.
Industry stakeholders also raised the issue of shortage of containers for exports. The Minister assured that the situation is expected to normalise in next 2 or 3 weeks.
“The Government is aware of the problems faced by the MSMEs because of the issue. We are very seriously working on a proposal on how we can control prices of raw materials,” he said.
He also urged the industry also to suggest measures to resolve it.
The Minister also said that the manufacturers should focus on quality and also reduce the production cost. He insisted on the use of good technology and urged the industry to explore joint ventures to get better technology.
He added that the Government wants to make India a global manufacturing hub. The Indian exporters can become major suppliers to different countries that are looking at alternatives.
Source: Apparel Online
Insolvency and Bankruptcy Code 2016 (IBC), in a span of four years, has turned out to be the proverbial giant in the annals of Indian corporate law. The legislation catapulted India from a lowly 142 in 2014 to 63 in 2019 in World Bank’s Doing Business rankings. Though not a recovery mechanism, IBC resulted in mean recoveries of 44% for financial creditors in comparison to 24% from Debt Recovery Tribunals (DRT), SARFAESI Act and Lok Adalat combined, for financial years 2018-2020.
Jurisprudence of any legislation takes time to evolve and IBC was no exception; interpretation of contentious clauses for corporate insolvency is now settled.
Covid-19 disrupted IBC’s stellar run as filings were suspended effective 25th March 2020. One area that required bolstering even before suspension was the National Company Law Tribunal (NCLT). As of 31st July 2020, a total 19,844 cases were pending before NCLT of which 12,438 pertained to IBC.
Approximately, 3,000 cases are undergoing resolution and liquidation, implying that 9,000 cases are pending admission. An opportunity to reduce the backlog, which would have been possible with better infrastructure, more members and expeditious hearings, was missed amidst Covid-19.
Filing was deferred due to Covid-19 in most jurisdictions, barring the US. Mature insolvency jurisdictions either had a plethora of tools in their armoury to navigate insolvency or had the template to assemble them. As an example, Britain had administrations, pre-pack, company voluntary arrangements, receiverships and scheme of arrangement under Companies Act; all procedures in congruence with each other. The template European countries relied on for a quick pivot in 2020 was based on the European Union Directive (EUD) on Preventive Restructurings 2019/1023.
Thus, Britain was able to roll out CIGA 2020, Netherlands its WHOA and Germany its StaRUG. All the aforesaid insolvency frameworks are geared towards pre-insolvency restructuring and have common elements like debtor-in-possession, pre-insolvency moratorium, cram-down of dissenting class, set-aside ipso-facto clauses, etc.
India too has several tools/laws to deal with insolvencies. However, these laws are operating in silos, are not speaking to each other, and have certain deficiencies. Apart from the IBC we have the Reserve Bank of India (RBI) Prudential Framework, SARFAESI Act and section 230 of Companies Act 2013. Prudential Framework does not involve all forms of financial creditors; mutual funds and insurance companies are left out of its ambit. Thus, enabling legislations and/or guidelines by SEBI, IRDAI and RBI jointly can resolve this anomaly.
Asset Reconstruction Companies (ARCs) work under the auspices of SARFAESI Act. Tweaks in clauses to facilitate change of management and appointment of managers with more powers, akin to a chief restructuring officer, will enhance quality of restructuring. Also, DRT should be subsumed under NCLT for consistency of judicial outcomes.
In the past few months, both the officials of Insolvency and Bankruptcy Board of India (IBBI) and the Government have talked about the introduction of prepacks. Prepacks will indirectly reduce NPAs and the burden on tribunals. Presumably, prepacks follow EUD in spirit and include the concept of interim/new financing. Also, since IBC is inherently geared towards the sale of a company, a separate chapter for prepacks will be apt.
Section 230 of Companies Act 2013 is rarely used as the process of seeking approval from each class of creditors and shareholders is cumbersome. Introduction of cram-down may enhance its usage.
Thus, harmonisation of procedures with certain common tenets, post appropriate legislative changes, alongside lifting of suspension, will help insolvency laws achieve their true potential even in the current exceptional scenario. One plausible decision matrix of the same is illustrated.
Additionally, tax matters arising from any of the aforesaid procedures should be addressed. Carry forward of losses, in case of companies, in which the public is not substantially interested, should be allowed. Also, profits arising on write-back of loan irrespective of its end-use i.e., capital assets or working capital, interest, and payables, should not be taxed.
Source: The Economic Times
Over the years, suit and blazer have evolved parallel to the preferences of the modern global consumer especially the country that has winter all year round. As most lucrative attires it’s taking vantage position gradually while brands are heading forward to produce it on large scale.
Growing demand
Rising disposable incomes, growth in purchasing power of the people from different socio-economic classes, increasing fashion consciousness and travels are driving the consumer demand for premium and luxury products.
As per Technavio, the rise in the adoption of sustainable manufacturing will have a positive impact on the growth significantly of the global waistcoats, jackets, and suits market.
Trendy global suit fashion
When it comes to men’s clothing, nothing is more impressive than a suit. In western countries, young and teenagers prefer t-shirts and jeans always as streetwear dress, but in job interviews, corporate culture, court appearances and wedding functions they must choose blazers as symbolic dress code. Sometimes they are seen to wear both t-shirt and suit together.
Black is a common color for the suit segment. Transforming black to plain navy two-button with a notch lapel, it will give an extra dimension to look a rich fashion.
While single-breasted counterpart has proved its versatility and continued popularity, blazer lovers want to pick the right setting for a double-breasted blazer. Typically, six buttons lapels double-breasted suit created a craze among American bankers in the ’80s. This old fashion has come back again greatly among young people with stylish cut & shape. Many guys choose this option for its inherent flair.
It’s a lot more versatile than something anyone pair with leather leggings or a midi skirt! The traditional black and white variant of checked print is perfect for the office. But the Scottish tartan will give blazer lovers an exciting new look.
The oversized, boxy, menswear blazer has taken over the runway and become a street style favorite for spring 2020.
Who knew dad would become such a style icon? For the oversized check blazer, fashion lovers go full force with the dad look.
Different washed and knit blazer is gaining popularity among customers. Pastel and cheery suits are trending during Covid-19 challenging times. Bright colors are great, especially for the summer vibe.
Global value of suit and blazer market
The blazer market looks like a positive growth even if the Covid-19 outbreak. Experts say, during the pandemic although the whole textile market shrinks, gradually business turns back while the critical situation is overcoming.
According to Statista, the value of jackets, coats and blazers product segment are about US$ 39 Bn & is expected to reach a value of US$ 134 Bn at a CAGR of 6.6% growth rate and account for 47% of the market share by the end of 2027.
Presently China controls the market share up to 70%. Bangladesh, Vietnam, Taiwan, Cambodia, Turkey, India, Pakistan, Sri Lanka dominate 15%, 10%, 4% & others 1% respectively. European countries like Italy, France, Portugal, and Romania also manufacture suits on an industrial scale.
The USA is the largest market export destination for Blazer. In global comparison, most revenue is generated in China who exported US$ 6.42 Billion worth of blazers during FY 2019-20, according to the Business wire.
Bangladesh exported US$ 200 million in the last fiscal year while US$ 196.01 million, US$ 174.8 million, US$ 144.06 million, US$ 122.89 million from Vietnam, Taiwan, Cambodia, India respectively.
Covid-19 impact on blazer business
Covid-19 has shaken up the world’s fashion sector like a hurricane. During a pandemic, total retail apparel sales have been decreased 28 to 32% in 2020, while luxury apparel sales have dropped 16.8%, says Trendex, a market intelligence company. It has also affected the blazers industry whose sales have fallen by 10% in the last 8 months globally.
Indeed suit, blazer, coat & jacket business has been “extremely slow” even since the end of lockdown. Hugo Boss, Gap, Bonobos, Uniqlo, H&M, M&S, Calvin Klein, Tommy Hilfiger, Ralph Lauren, Armani, Garry Weber, LPP, Diesel, Kaiser, Zara, Jack & Jones, etc popular brands lost at least USD 40 billion to sell high-end blazer. Garry Weber’s sales for the six months fell 43.3% to 140.5 million euros, 61.5% sales of M&S dropped of the first quarter of the year although it recovered 21.3% dramatically of the second quarter, PVH lost 43% high-end product sales in last 6 months amounted for US$ 1.2 bn.
Around the world, the second wave of Covid-19 has already been started while everybody thinks the first phase is ended almost. Already few European countries undergo lockdown. Undoubtedly this will hit the business again from the first months of the New Year.
Business insiders think the industry may take a minimum of four to six months to see business back to the normal track. Financially strong companies are expected to recover faster.
E-commerce sales are growing tremendously during the pandemic. Online sales have jumped 66%, as Hugo Boss launched e-commerce in 24 markets to meet its target for €400 million of online sales by 2024. Not only Hugo Boss, 34% surge in online sales of M&S but H&M also invested £530m – 45% of its total investments, 26.2% from Uniqlo and in average the online sales growth rate of premium quality blazer making brands are up to 46%.
Source: Textile Today
The Goods and Services Tax (GST) portal experienced technical failure on Thursday, leaving taxpayers worried amid fast approaching due dates for return filing.
The technical failure of the portal, which is maintained by Infosys, caused #gstnfailed to trend on Twitter.
The official Twitter handle of the GST Network (GSTN) responded on the micro-blogging site saying: "Dear Taxpayers, we have received complaints regarding difficulty in accessing the portal. We are working to resolve the same and will keep you updated."
Hours later, in another tweet, it said: "Dear Taxpayers, we have again received complaints of denial of access to the portal and are working to resolve it. Inconvenience caused is regretted. Team Infosys-GSTN."
The Infosys-GSTN team has finally confirmed in a tweet that the problem faced by the users has been resolved.
"Dear taxpayers, we observed some activity in cyber space by unscrupulous elements because of which some taxpayers may have experienced difficulties/delays in accessing GST Portal which otherwise is working fine. We have resolved the problem and blocked these activities. Kindly retry to access the portal. Inconvenience caused is regretted. Infosys-GSTN team," it wrote on Twitter.
The Centre has extended the due date for furnishing annual GST or goods and services tax returns for the financial year 2019-20 by two more months. The new deadline is 28 February, 2021, instead of 31 December, 2020.
GST is an indirect tax that replaced a welter of indirect taxes in India such as the excise duty, services tax, and VAT. The GST Act was approved in Parliament on 29 March, 2017, and became law on 1, 2017.
Form GSTR 9 is used by the registered taxpayers to file a GST return every year.
Source: The Mint
Duerkopp Adler has announced the discontinuation of its Commander Basic which is a touch control panel attached in its sewing machines.
As digitisation and networking technology is constantly evolving and is finding its way into production facilities around the world, the decision has been taken to remove the Commander Basic from its product range with immediate effect due to the lack of a network interface.
However, stepping towards more advancement, the sewing tech leader will continue offering the users the future-oriented QONDAC Commander Pro version.
According to Duerkopp Adler, Commander Pro offers a modern, networkable machine control panel with which factories can lay the perfect foundation for intuitive machine operation and their digital production.
The Commander Pro is still available for all M-TYPE PREMIUM designs of the German company.
Source: Apparel Online
Mexican President Andres Manuel Lopez Obrador on Thursday hailed the agenda set out by his new U.S. counterpart Joe Biden, offering support for his plans to combat the coronavirus pandemic, lift the economy and to enact migration reform.
"We agree with the agenda they presented, with what President Biden is proposing," Lopez Obrador told reporters at a regular government news conference.
Biden issued half a dozen executive orders after his inauguration on Wednesday to reverse hardline immigration policies put in place by former President Donald Trump.
Biden also sent a bill to Congress which could open a path to citizenship for immigrants living in the United States, which Lopez Obrador described as "very good".
Source: The Hindustan Times
The European Union and Turkey pressed each other on Thursday to take concrete steps to improve relations long strained by disagreements over energy, migration and Ankara's human rights record.
Turkey, which remains an official candidate for EU membership despite the tensions, is facing the threat of EU economic sanctions over a hydrocarbons dispute with Greece in the eastern Mediterranean, but the mood music between Brussels and Ankara has improved since the new year.
"We have seen an improvement in the overall atmosphere," EU foreign policy chief Josep Borrell said as he welcomed Turkish Foreign Minister Mevlut Cavusoglu for talks, describing 2020 as complicated.
"Intentions and announcements need to be translated into actions," Borrell said.
The improved tone follows a video conference between Turkish President Tayyip Erdogan and the head of the European Commission, Ursula von der Leyen, on January 9 in which both stressed the importance of the bilateral relationship.
Cavusoglu said he hoped von der Leyen and Charles Michel, the head of the European Council which represents the 27 EU member states, would visit Turkey after an invitation from Erdogan.
"It is of course important for there to be a positive atmosphere in Turkey-EU ties, but in order for this to be sustainable, we must take concrete steps," Cavusoglu added.
STRAINED TIES
2020 proved particularly difficult for relations between Turkey and the EU, especially France, with Erdogan expressing publicly his hope that protests in French cities would topple President Emmanuel Macron.
Greece and Cyprus, strongly backed by France, want to punish Turkey for what they see as provocative oil and gas exploration by Turkish vessels in disputed waters, but Germany and Italy are reluctant to go ahead with any sanctions on Ankara.
Turkey has now withdrawn the vessels and is set to restart talks with Greece, although the EU has accused Ankara of playing "cat and mouse" in a pattern of provocation and reconciliation.
EU leaders will decide in March whether to impose sanctions.
Brussels also accuses Erdogan of undermining the economy, eroding democracy and destroying independent courts and media, leaving Turkey's bid to join the EU further away than ever.
"We remain concerned about the (human rights) situation in Turkey," Borrell said on Thursday.
The European Parliament is expected on Thursday to back a resolution calling for the release of Selahattin Demirtas, a leading Kurdish politician jailed in 20216 on terrorism-related charges.
But Turkey remains a big destination for EU trade and investment and also hosts some 4 million Syrian refugees. The EU aims to agree fresh funds for the refugees from 2022 to discourage them from coming into the bloc.
Ankara wants progress on Turks' right to visa-free travel to the EU, an upgrade of its trade agreement with Europe and recognition of its claims to hydrocarbons off its maritime shelf.
Source: The Hindustan Times
Immigrants cheered President Joe Biden’s plan to provide a path to U.S. citizenship for about 11 million people without legal status, mixing hope with guarded optimism Wednesday amid a seismic shift in how the American government views and treats them.
The newly inaugurated president moved to reverse four years of harsh restrictions and mass deportation with a plan for sweeping legislation on citizenship. Biden also issued executive orders reversing some of former President Donald Trump’s immigration policies, such as halting work on a U.S.-Mexico border wall and lifting a travel ban on people from several predominantly Muslim countries. He also ordered his Cabinet to work to keep deportation protections for hundreds of thousands of people brought to the U.S. as children.
“This sets a new narrative, moving us away from being seen as criminals and people on the public charge to opening the door for us to eventually become Americans,” said Yanira Arias, a Salvadoran immigrant with Temporary Protected Status who lives in Puerto Rico, a U.S. territory.
Arias is among about 400,000 people given the designation after fleeing violence or natural disasters.
“It sets a more hopeful future for immigrants in the U.S., but it all depends on the Congress, especially the Senate,” Arias, a national campaigns manager for the immigrant advocacy group Alianza Americas, said of the citizenship effort.
Success of the legislation is far from certain in a divided Congress, where opposition is expected to be tough. The most recent immigration reform attempts on a similar scale failed — in 2007 under then-President George W. Bush and in 2013 under then-President Barack Obama.
Ofelia Aguilar, who watched Biden’s inaugural address on TV with four other female farmworkers in agricultural Homestead, Florida, said she nevertheless felt positive about prospects for immigration reform.
“I am hopeful that he’ll give us legal status,” said Aguilar, who was pregnant and alone when she came to the U.S. from Mexico in 1993. She worked in the fields for years before starting her own business farming jicama root.
“There is hope!” Aguilar cried out after Biden was sworn in. “So many people have suffered.”
Some of the farmworkers at the backyard gathering about 35 miles (56 kilometers) south of Miami said they were disappointed Biden didn’t mention immigration reforms in his speech.
“I have faith in God, not in presidents,” said Sofía Hernández, an agricultural worker who has lived in the U.S. without legal status since 1989. “So many have said they are going to do things, and I don’t see any results.”
Hernandez came from Mexico, seeking economic opportunity. Her three children were born in the U.S. and she regularly sent money to her family back home before her parents died.
“My dream is to go and see my family and come back to stay with my children,” Hernandez said.
In New York, Blanca Cedillos said she also was disappointed Biden did not mention immigration during the speech she watched with a half-dozen other masked immigrants at the Workers Justice Project.
“I was hoping he would say something,” said Cedillos, a Salvadoran who lost her job as a nanny during the coronavirus pandemic and now gets by with a few housecleaning jobs and a weekly food box from the nonprofit that offers services to immigrants.
Cedillos has lived in the U.S. without authorization for 18 years and hopes to eventually visit her four children in Central America, then return legally to the U.S.
“I have told them that that trip may happen now. Hopefully, if this new president gives me the opportunity,” she said.
Guatemalan construction worker Gustavo Ajché, who came to the U.S. in 2004, watched the Spanish language broadcast with Cedillos.
“I don’t want to get too excited because I might get frustrated afterward, like has happened in the past,” Ajché said. “I have been here many years, I have paid my taxes, I am hoping something will be done.”
In Phoenix, Tony Valdovinos, a local campaign consultant who was brought to the U.S. from Mexico as a small child, said he isn’t celebrating yet.
He’s among those who have benefited from the Obama-era Deferred Action for Childhood Arrivals program, or DACA, which protects immigrants brought to the U.S. as children from deportation.
“It’s hard to put your heart into it when these things have failed in the past,” Valdovinos said. “We’ve been beaten down so much.”
Maria Rodriguez, executive director of the Florida Immigrant Coalition in Miami, said she feels much the same way.
“I’m so happy and relieved, but we are still afraid of getting our hearts broken again,” she said. “We’ve been through this so many times, but we really need to bring through a solution that goes forward.”
Los Angeles janitor Anabella Aguirre wants that solution not only for herself, but for her two daughters, both DACA recipients now starting their careers.
“Like thousands of mothers and fathers, I want for my daughters to have something better in this country,” Aguirre said. “We hope that today, this dawn, brings hope.”
Source: New Delhi Times
