NATIONAL

• Approval received for opening textile skill centres in Malwa
• Board of Approval (BOA) to consider, decide the cases for extension of Letter of Permission of existing EOUs: DGFT
• RBI may cut rates in Sept, GDP growth steady: Poll
• Law Panel recommends changes in Bilateral Investment Treaty draft to make it investor-friendly
• India to set up SME business clusters in CLMV countries

INTERNATIONAL

• WTO rules against Argentinian import measures
• Pakistan textile exporters still waiting for refunds: FBR issues RPOs
• WTO to partner with NEXIM bank to promote regional trade

Textile Raw Material Price 2015-08-27

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15569 USD dtd. 27/08/2015)

The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

Approval received for opening textile skill centres in Malwa

The cabinet has approved proposal put forward by Harsimrat Kaur Badal, Bathinda MP and union food processing industries minister for opening of two textile skill centres in Malwa region. One such centre would come up in a rural area of Bathinda and the other in Mansa. Two days ago, the minister was inform about opening of two centres in the region by the textiles ministry. Bathinda is known as cotton belt and the Centre wants to develop it as textile hub and opening of skill centres is the first step, the minister said. The textile ministry has approved opening of two textile skill centres in the region where 16,000 girls would be provided training in various vocations. These girls would also be provided jobs in the upcoming textiles park to be set up in Bathinda on completion of training.

SOURCE: Yarns&Fibers

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Board of Approval (BOA) to consider, decide the cases for extension of Letter of Permission of existing EOUs: DGFT

The Directorate General of Foreign Trade (DGFT) has incorporated a new provision in the Aayat Niryat Forms of the Foreign Trade Policy (FTP) 2015-20, with the view to enable the Board of Approval to consider and decide the cases for extension of Letter of Permission of existing Export Oriented Units (EOUs). “An enabling provision has been incorporated in paragraph (7) of Appendix 6-B of Appendices and Aayat Niryat Forms of FTP 2015-20,” DGFT said in a notification. Earlier, activities pertaining to reprocessing of garments/ used clothing /secondary textiles materials / clipping/ rags/ industrial wipers/shoddy wool/ yarn/ blankets/ shawls and other recyclable textile materials were not allowed under EOU schemes. Now, according to the DGFT notification, “Activities pertaining to reprocessing of garments/ used clothing /secondary textiles materials / clipping/ rags/ industrial wipers/shoddy wool/ yarn/ blankets/ shawls and other recyclable textile materials will not be allowed under EOU schemes. Provided that extension of Letter of Permission for an existing unit shall be decided by the Board.”

SOURCE: The KNN India

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RBI may cut rates in Sept, GDP growth steady: Poll

There is a better than even chance that the Reserve Bank of India will cut interest rates at its policy meeting on Sept 29 thanks to inflation striking a record low, according to a Reuters poll, marking a shift in expectations from earlier. The median from survey of 21 economists showed a 60 per cent chance that the central bank would cut its policy repo rate from 7.25 per cent at the next meeting, whereas a previous poll in July had shown a move was more likely in the final three months of the year. Since then, India has released consumer price data for July that showed retail inflation at a record low of 3.78 per cent, giving the RBI more room to ease policy.

Keen to inject more momentum in the economy and encourage investment, the government and business community have urged the central bank to lower interest rates, though RBI Governor Raghuram Rajan has stressed that he wants to see low inflation on a sustained basis. “We have fuel disinflation making a comeback all over again. Crude prices are back down,” said Vishnu Varathan, senior economist at Mizuho Bank. Varathan noted the price of onions, a staple ingredient in Indian cooking, was beginning to rise, putting upward pressure on food inflation. But, he said the RBI would find it harder to cut interest rates later in the year, if the US Federal Reserve delays raising interest rates, which it is expected to do.

The RBI left interest rates unchanged at its last policy review on Aug.4, having already cut them by 75 basis points this year as a slump in global commodity prices brought inflation under control. By holding rates steady, Rajan went against the majority on an advisory panel, who had recommended a reduction. India is due to release economic growth data for the April-June quarter on Monday. The median forecast given by 27 economists put year-on-year growth at 7.4 per cent for the quarter, slowing from 7.5 per cent in the January-March period. Whereas the headline figure looks healthy, many economists have treated the data series with caution since the statistics department revised its methodology for measuring gross domestic product earlier this year.

Other indicators and on-the-ground evidence suggest the economy is struggling, and there is growing impatience with Prime Minister Narendra Modi’s government to implement more policies that can galvanise growth. The government is trying to introduce a nationwide goods and services tax to create a more unified market in a country where levies can differ from state to state. Twelve of the 21 economists polled doubted whether the government could roll out the tax before the next fiscal year begins in April.

SOURCE: The Financial Express

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Law Panel recommends changes in Bilateral Investment Treaty draft to make it investor-friendly

The Law Commission has recommended some key changes in the 2015 draft of the model Bilateral Investment Treaty (BIT) that includes introducing a confidentiality clause to make the proposed treaty more investor-friendly. The law panel submitted its recommendation to the government on Thursday, saying they were made with the intention to achieve a balanced negotiating text that takes into consideration the protection of Indian investors investing abroad, as well as safeguarding the regulatory powers of the state.

India had signed its first BIT with the UK in 1994, and has signed 83 BITs till date, of which 74 are in force.India has also entered into 11 Free Trade Agreements which have a dedicated chapter on investment, that are substantially similar to the standalone BITs. The BITs are part of the larger trade and investment agenda of the government to boost investor confidence and increase investment flows into and out of the country. The law panel has suggested inclusion of most favoured nation in the model treaty. It also said government procurement should not be excluded from the treaty's protection. "Any disclosure requirement, or in fact, any obligations imposed under a BIT on investors must take into consideration national treatment obligations that are provided for through the same treaty," the Law Commission said. "Excluding public procurement could lead to the exclusion of many activities that would otherwise meet treaty objectives of contributing substantially to the host state's development. Absence of treaty protection could lead to an exodus of foreign investors which may not be desirable in the long term," it said.

The commission also said it was not necessary to exclude taxation from the purview of the treaty as "power to tax is an integral part of the state's police powers in international law. The power to tax exists independent of a treaty, unless the tax itself is arbitrarily imposed to destroy the state's regulatory freedom". It suggested that specific provisions should be included to ensure that "nothing in this treaty shall apply to either party in relation to any act or measure or law that existed before the date of entry into force of this treaty". The report was submitted to law minister Sadananda Gowda by Law Commission chairman Justice A P Shah. The government will soon come out with a comprehensive model BIT, which will form the basis for renegotiation of the existing pacts and negotiating new ones with different countries.

SOURCE: The Economic Times

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India to set up SME business clusters in CLMV countries

India to promote investment in CLMV countries like Cambodia, Laos, Myanmar and Vietnam as well as offer cost rationalization will be setting up business clusters for small-medium scale industries. This is the new thrust of the government through EXIM Bank of India. Under a cluster based approach, the country will be setting up clusters of small-medium enterprises not only in India but outside as well, said bank chairman and managing director Yaduvendra Mathur during the FICCI Banking Conclave here. Mathur said that the south east Asian countries are the new places of opportunity for Indian businesses to set-up units to rationalise their manufacturing process.

Besides focusing on south east Asia, businesspeople need to focus on the European countries as well for asset acquisition. The success of the small-medium enterprises has put Bangladesh's textile industry as a global leader in the world map. Further, referring to the Make in India campaign which aims to boost the country's manufacturing capabilities and draw in investment, he said that we need to do some part of production in India while some of the finishing in the CLMV countries. If we add 35 percent (of input for the product) in CLMV, then we are satisfying the WTO and trade agreements to the rules of origin. In fact, China has been using this method to flood its goods in India. China has been using these countries to pump in products into India. This was not understood by us when signing the Free Trade Agreements.

SOURCE: Yarns&Fibers

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WTO rules against Argentinian import measures

The World Trade Organization ruled last week that certain conditions which Argentina imposes on firms wishing to import goods into the country break WTO law. The EU, Japan and the US launched a WTO dispute settlement case in May 2012. Initial consultations with Argentina in July 2012 did not bring an amicable solution. As a result, the WTO set up a panel in January 2013. The practices complained of include offseting the value of imports into Argentina with the equivalent in exports; reaching a certain level of local content in their domestic production; a requirement to invest in Argentina; and keeping profits made in Argentina in the country.

The WTO panel ruled that Argentina may not require local importers or foreign firms to accept practices forced upon them by the Argentinean authorities as a condition for being allowed to import goods into the country. “I’ve made standing up to protectionism one of the hallmarks of my term as EU Trade Commissioner,” said EU Trade Commissioner Karel De Gucht. “This case sends an important signal that protectionism is not acceptable. I call on Argentina to move quickly to comply with the ruling of the WTO panel and remove these illegal measures, and open the way for EU goods to compete fairly on the Argentinian market.” The WTO panel also ruled against a procedure known as the Advanced Sworn Import Declaration (Declaración Jurada Anticipada de Importación or DJAI, which requires firms to secure approval by the Argentine authorities before importing goods.

Argentina introduced the measures as part of a managed trade policy which aimed to substitute imports for locally-sourced products and to reduce the country’s trade deficits with other countries. The parties now have 60 days in which to appeal against the panel’s ruling. If there is no appeal, Argentina will have to bring itself into compliance by changing these measures within a reasonable period of time. That period of time will either be negotiated between Argentina, the EU, the US and Japan, or fixed by a WTO arbitrator.

SOURCE: The Global Trade Magazine

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Pakistan textile exporters still waiting for refunds: FBR issues RPOs

Though the Federal Board of Revenue (FBR) has issued refund payment orders (RPOs) for January and February 2015, some exporters are still waiting for their cheques. This was revealed during an anecdotal survey of textile exporters by Business Recorder. The exporters lamented this delay which they pointed out was in spite of the commitment of Finance Minister Ishaq Dar made in his budget speech 2015-16 that refunds to export oriented sectors relating to tax periods till May 31, 2015 shall be issued by August 31, 2015. When contacted, textile industry stakeholders said that about Rs 100 billion of textile exporters are stuck with FBR in sales tax, customs rebate and federal excise duty refund regimes creating severe financial crunch.

The sales tax refund issue has been a sticking point between the textile mills and the government with the former repeatedly insisting that delays in refunds are negatively affecting their sector. All Pakistan Textile Mills Association (APTMA) office bearers told Business Recorder that delay in payment is one of the main issues hindering their operations and requires immediate attention. Value added textile sector office-bearers said that about 2 percent of the value of total textile exports is stuck with FBR under different schemes, making it difficult for them to remain viable. The FBR officials in a recently held meeting challenged the amount of refunds cited by APTMA and maintained that refund claims are no more than Rs 25 billion and would be cleared by 31 August, as per the government's commitment.

The FBR has taken some decisions to expedite payment of refunds and duty drawback to the textile exporters. In the last meeting between FBR and APTMA, the industry objected that the Expeditious Refund System (ERS) for payment of sales tax refund claims entertains those claims where the refund claim does not exceed 3.5 percent of value of supplies. It was suggested that the said threshold needs to be increased. The FBR decided that the FBR Member IR Operations should appropriately increase the said threshold.

SOURCE: The Business Recorder

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WTO to partner with NEXIM bank to promote regional trade

The World Trade Organization, WTO​,​ on Wednesday pledged to collaborate with the Nigerian Export-Import Bank, NEXIM, to explore areas of synergy to help remove trade barriers and provide better access to market commodities towards regional integration and poverty eradication. The WTO is the global trade group working on developing a global value chain for better trade information, rules and trade regimes towards the smooth flow of trade between nations. The organization also provides the framework for negotiating trade agreements, dispute resolution process aimed at enforcing participants’ adherence to WTO, which has trade finance as the core area of encouraging regional integration and a key factor in poverty eradication.

NEXIM is Nigeria’s premier ​e​xport ​c​redit ​a​gency mandated to promote the diversification of the country’s economy and deepen the external sector, particularly the non-oil sector, providing credit facilities in both local and foreign currencies; risk-bearing facilities through export credit guarantee & export credit insurance; business development and financial advisory services. The ​d​eputy ​d​irector ​g​eneral of the WTO, Yonov Agah, told the ​m​anaging ​d​irector/​c​hief ​e​xecutive of NEXIM, Roberts Orya, during a courtesy visit in Abuja that the global trade group would be willing to support the ​b​ank realise its mandate. While commending Mr. Orya for leading the management of NEXIM on the right track, the ​d​eputy DG said the WTO was determined to encourage the Bank as a Trade Policy Bank to deepen relationships with the relevant regulatory agencies and players in a bid to remove the bottlenecks to growth in the sector. “Although empirical trade policy analysis is lacking in the different sectors, the WTO is working on developing a Global Value Chain for better Trade Information and Trade regimes,” Mr. Agah said. “We will work with the management of NEXIM Bank to achieve the desired goals and objectives of providing a seamless trade policy document.” The ​d​eputy ​d​irector, who said the WTO aims to create awareness and proffer solutions to the peculiar experiences in different countries with regards to trade, urged NEXIM to explore collaborating with their in-house institute for training and technical acquisition.

Earlier, Mr. Orya gave an overview of NEXIM’s mandate as a trade policy Bank promoting export diversification and deepening the non-oil sector. The ​b​ank, he explained, pursued these strategic mandates targeted at boosting employment creation and foreign exchange earnings in the Manufacturing, Agro-processing, Solid Minerals and Services (Tourism, Transportation and Entertainment) industries. The NEXIM boss told the Director General about the various initiatives embarked upon by the Bank to expand trade, particularly regional trade, by setting up the Sealink project, a Special Purpose Vehicle, SPV, to promote trade within the Economic Community of West African States, ECOWAS, sub-region. Other initiatives by NEXIM include the ECOWAS Trade Support facility, ETSF, to enhance movement of goods across borders; the Interstate Road Transport Scheme, ISRT, to promote free flow of goods among member states; free duties, taxes and restrictions while in transit, and the Nigerian Creative and Entertainment facility, to support the structured growth and development of the entertainment sector. “We are going to work with the WTO; deepen our relationship with relevant government agencies, like the Standard Organisation of Nigeria, SON; National Agency for Foods, Drugs, Administration and Control, NAFDAC; Nigerian Customs Service, NCS, and other relevant agencies. All of us will come together to determine how we will drive Nigeria’s export market,” Mr. Orya said. In a related development, Mr. Orya also played host to the Greek Ambassador to Nigeria, Alekos Ikonomopoulos, who also visited the Bank to discuss areas of possible partnerships and between Nigeria and Greece in promotion of non-oil exports. Mr. Orya, who highlighted notable Greek-owned companies currently operating in Nigeria, thanked the envoy for taking the initial step to seek to work with the Bank. He used the opportunity to present an update on the Sealink Project implementation, describing it as a private sector-driven project, saying NEXIM Bank was only facilitating its establishment in line with its mandate as Nigeria Trade Policy Bank of to promote and deepen non-oil export trade.

The Sealink Project, Mr. Orya explained, would promote intra and inter-African trade, thereby fostering regional integration, economic growth and development in the West and Central African sub-regions. Notable Greek investments in Nigeria today exceed $5 billion, and are growing. For example, the Greek owned Flour Mills of Nigeria’s investment into UNICEM cement factory Calabar, Cross River State,” he said. The ​ambassador pledged mutual cooperation with NEXIM to boost trade relations between Nigeria and Greece. “We shall create the enabling environment for Greek investors to collaborate with Nigeria in the areas of Technology, Maritime and Agriculture,” he stated.

SOURCE: The Premium Times Nigeria

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