Prime Minister Narendra Modi lauded the role of the private sector as he threw his weight behind the government’s agenda of privatisation and economic reforms, asserting that “abusing” wealth creators for votes was no longer acceptable, and that the bureaucracy should take a backseat in the running of factories and business.
“The public sector is essential, but at the same time, role of the private sector is also vital. Take any sector – telecom, pharma – we see the role of the private sector. If India is able to serve humanity, it is also due to the role of the private sector,” said the PM on Wednesday, replying to the discussion in the Lok Sabha on the motion of thanks to the President’s address.
“Wealth creators are required in the country. How else can wealth be distributed, who will create employment?” he said. “Will babus do everything? They become IAS and they run fertiliser, chemical factories and fly aircraft? What are we going to do by handing over the country to babus? If babu belongs to this country, youth also belong to this country.”
The comments come days after the budget proposal to enhance the foreign direct investment (FDI) limit in the insurance sector to 74%, from 49%, and to privatise one state-run insurance company and two banks.
This is also in the backdrop of the farmers’ agitation against three new laws aimed at deregulating the sale and distribution of crops, which has fuelled the opposition’s charges of crony capitalism against the government.
Modi said maligning the private sector might have got some people votes in the past, but that method wouldn’t work any more, especially since many among the youth are contributing to the private sector. “The culture of abusing the private sector is not acceptable any longer. We cannot keep insulting our youth like this," he said.
He said the time has come for India to deftly position itself “in the post-Covid world order” to tap the full global potential it offers, rather than the old practice of keeping to a corner of the global platform.
The PM said the manner in which India “contained the unknown enemy, Covid-19” has enhanced the country’s standing among large nations.
Responding to Congress MP Manish Tewari, who had earlier claimed that India could overcome Covid-19 only by “God’s grace,” Modi said, “Yes, we got bhagwan ki kripa… But, bhagwan ki kripa came in the form of our collective resolve, in the roles of our doctors, nurses, ambulance drivers, discipline followed by our people….”
Source: The Economic Times
India’s elevated deficit projections up to FY26 announced in the Budget will make it more challenging to reduce its debt-to-GDP ratio, which could rise above 90% over the next five years, global rating agency Fitch said on Wednesday.
Given the spike in both fiscal deficit and debt levels in the wake of the Covid-19 pandemic, India’s medium-term growth outlook will play a more critical role in the assessment of its sovereign rating, Fitch added.
Before the pandemic, the agency said, India’s debt was 72% of GDP (in 2019). The government now targets to lower fiscal deficit to 4.5% of GDP by FY26 from as high as 9.5% in FY21.
Fitch has projected India’s real growth at 11% in FY22 then at around 6.5% a year through to FY26. “This pace of expansion reflects base effects and the closing of output gaps after the pandemic shock,” it said.
There is a risk that fiscal spending could also fall short of planned levels and the budget’s proposed increase in import tariffs could dampen trade and economic growth, it said. Even proposed reforms face implementation challenges.
It said the budgeted capital infusion of `20,000 crore into state-run banks will be “insufficient to alleviate the anticipated incremental stress” this year and the next. Plans to privatise two state banks could also be significant, but it could face implementation challenges, according to Fitch.
Nevertheless, the budget for FY22, in aggregate, has the potential to lift growth prospects. “Higher expenditure will support the near-term recovery and increased infrastructure spending could boost sustainable medium-term growth rates. Labour market and agricultural reforms that were legislated in September 2020 could also lift medium-term growth,” it said.
The proposed establishment of the so-called bad bank to deal with bad banking sector assets should be credit positive, subject to details of its structure and implementation.
Fitch also maintained that recent reforms and policy measures, including those announced in the budget, could also “influence our growth expectations and, thus, our debt trajectory forecasts”.
State banks are likely to continue to experience asset-quality problems, weak profitability and small capital buffers and, as a result, we project credit growth to remain soft in the absence of further government action, Fitch said.
Source: The Financial Express
The infrastructure is ready for Bihar to take off on the industrialization runway soon, said Syed Shahnawaz Hussain after taking charge as Bihar's industries minister on Wednesday.
Speaking exclusively to TOI, Shahnawaz further said he would study the policies of other states to make relevant changes in the Bihar Industrial Investment Promotion Policy 2016. He appealed to the businessmen from Bihar running industries across the country and abroad to come and invest in their home state.
“Come and invest in Bihar, which has a stable government, ready infrastructure, better power, road and water facilities and an excellent chief minister in Nitish Kumar,”appealed Shahnawaz, the BJP national spokesman, who has been brought to Bihar to deliver on the promises made during the 2020 assembly polls.
He added, “It is the dream of PM Narendra Modi to see Bihar as an industrialized state, and I have been assigned this challenging task to realise it under the leadership of CM Nitish Kumar.”
Asked about BJP’s poll promise of generating 19 lakh employment opportunities, Shahnawaz said it would be delivered by setting up industries in the state, adding, the most talked-about issue during the Covid times included how to generate employment by increasing the resources.
“The coronavirus-induced lockdown followed by the return of our workers allowed us to map their skills. We have skilled workers in abundance. There is tremendous scope for textiles, ethanol and agro-based industries in Bihar. We have sufficient BIADA land but negligible industries,” Shahnawaz said.
He added, “I had long discussions with the department officials and I can assure our 14 crore people that the days are not far when Bihar will be among the top industrialised states in the country. We will focus on manufacturing things used in Bihar, including cars and other vehicles.”
The BJP national spokesman skirted a question on why all efforts made so far failed to bring industries and hummed an old Hindi number “chhodo kal ki baaten, kal ki baat puraani, naye daur mein likhenge milkar nai kahani…” from film Hum Hindustani.
To a question on a road map for Bihar, the former Union textiles minister said it’s too early to say anything. “But one thing is sure that we will bring industries to the same level as had been during the period of first CM Shri Krishna Babu in Bihar.
I will also utilize my old contacts to revive industries. We want to show the world that Bihar is not only a consumer market but a manufacturing hub as well,” he said.
Shahnawaz also said Bihar emporiums and haats would be opened in all big cities in the country and even abroad.
Source: The Times of India
Finance minister Nirmala Sitharaman on Thursday sought Parliamentary approval for an additional spending of Rs 6,28,380 crore in FY21, thanks to the government’s roll-out of various stimulus measures to soften the Covid-19 blow despite a plunge in its revenue mop-up.
This is the second batch of supplementary demands for the current fiscal, involving a net cash outgo of Rs 4,12,653 crore; the rest will be met through savings or enhanced receipts of various ministries and departments. The demands include a total of 79 grants and two appropriations.
The biggest chunk of the additional expenditure —Rs 3,04,558 crore — is meant for the ministry of food and consumer affairs. Of this, as much as Rs 2,50,209 crore is on account of extra food subsidy to be paid to Food Corporation of India (FCI) under the National Food Security Act and for free grain allocation in the aftermath of the pandemic, and the repayment of NSSF loans to FCI.
The supplementary demands also include Rs 65,412 crore for the department of fertilisers, primarily to clear fertiliser subsidies, and Rs 20,467 crore for the capital expenditure of the ministry of defence.
Similarly, extra spending of Rs 1,22,208 crore is for providing loans to state governments via a special window under back-to-back loans to them in lieu of the GST compensation shortfall and under special assistance (as loan) to them for capital expenditure.
The first batch of such demands (with gross expenditure of Rs 2,35,853 crore) was placed before Parliament in September 2020 before the government rolled out mainly demand-side stimulus measures.
The government is seeking approval for additional spending, as it was forced to offer relief packages in the wake of the pandemic despite a plunge in revenue collections.
Consequently, its fiscal deficit is expected to shoot up to as high as 9.5% of GDP, according to the revised estimate for FY21.
To fund the deficit, the Centre was also forced to raise twice its gross market borrowing to a total of Rs 12.8 lakh crore in FY21, up sharply from the budgeted Rs 7.8 lakh crore.
According to the revised estimate of FY21, total expenditure will rise to Rs 34.5 lakh crore, against the budgeted Rs 30.4 lakh crore. Revenue receipts, meanwhile, is estimated to slip to just Rs 15.6 lakh crore in FY21 from the budgeted Rs 20.2 lakh crore.
Even though the nominal GDP is expected to reverse a contraction and expand at 14.4% in FY22, the indispensability of continued spending to spur growth has forced the Centre to keep the deficit target elevated at 6.8% for the next fiscal as well.
Source: The Financial Express
The Parliamentary Standing Committee on Commerce on Wednesday suggested renegotiation India’s Free Trade Agreements with ASEAN, Japan and South Korea to ensure reciprocity in steel sector.
Until this is carried out, concessional tariffs with these countries should be suspended, it said.
“India’s concession to the ASEAN has been far in excess than concessions granted to India,” it said and suggested periodic compliance assessment to be carried out for Rules of Origin to arrest market access at concessional tariffs for non-FTA countries besides mandatory domestic content labelling requirement across the value chain.
For the electronics sector, it asked the government to provide protection to the domestic industry till the time it is competent enough to compete with global manufacturers.
The panel also recommended that any investment by foreign entity in electronics manufacturing including third party Electronics Manufacturing Services must be attached with a requirement of investment in infrastructure and promise of technology transfer so that domestic production of critical components can be achieved in the long run.
Stating that it is “deeply concerned by the poor industrial performance” of the country, it suggested a cut in GST for all categories of vehicles and auto components to 18% from 28%, introduction of an incentive-based vehicle scrappage scheme, and a single window clearance facility with faster regulatory clearances and incentives such as subsidy on interest rates and cheaper rate on gas/electricity for API parks.
“The Committee recommends that the Department (the Department for Promotion of Industry and Internal Trade) should look into the policy changes brought in by countries such as Vietnam, Taiwan, Thailand, etc that made them more attractive to the companies shifting their bases from China,” the committee said.
The panel said a long-term solution should be worked out in a structured manner to the land issue and suggested that the Centre constitute an Empowered Committee of State Ministers and the concerned Central Ministers to discuss issues regarding land acquisition and build a consensus on land reforms, in consultation with industry and other stakeholders.
“The Empowered Committee should look into issues relating to land acquisition policies, digitisation of land records and simplifying administrative procedures like registration and land use conversion. Further, the possibility of having a land bank that will be made readily available for developmental projects may be discussed with concerned stakeholders,” the committee said.
The panel, headed by YSRCP leader V Vijayasai Reddy, said the main challenges faced by the country presently included administrative and regulatory hurdles, inadequate and costly credit facility, tedious land acquisition procedure, inadequate infrastructure facilities, high logistics cost and large unorganised manufacturing sector, among others.
Stressing the need to sensitise the states machinery/administration towards the importance of investment and business, the report said countries are competing to attract foreign investors.
It asked the cente to enter into more international trade agreements that are beneficial to the country in order to boost its international trade relations.
The report said the panel is deeply concerned by the huge inflow of imported toys from China and its adverse impact on the domestic industries.
“The Committee is of the opinion that the development and nurturing of domestic industry and the promotion of domestic manufacturing of toys is of utmost importance. The Committee, therefore, recommends that concerted effort should be taken to promote domestic toy manufacturing,” the committee said.
Source: The Economic Times
The government has budgeted only Rs 13,000 crore for a scheme that is supposed to reimburse embedded levies paid on inputs consumed in exports in FY22, drawing a sharp reaction from exporters who warn of a delay in recovery in outbound shipments in the wake of the Covid-19 outbreak.
The outlay for the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme is way below the annual allocation of Rs 50,000 crore that the government had initially envisaged. Also, it’s only a third of the Rs 39,097 crore the government approved for exporters in FY20 under the Merchandise Exports from India Scheme (MEIS) that the RoDTEP has replaced.
Following a Covid-induced plunge in revenue mop-up, the government had drastically cut MEIS allocation to Rs 15,555 crore in the first three quarters of the current fiscal, much to the consternation of exporters.
Similarly, exporters said the latest finance Bill has proposed to amend the IGST Act, which would scrap an existing “seamless” refund facility for exporters (other than the designated ones) against their IGST payment on shipments. Any such change will force them to claim the IGST refund through the more time-consuming ITC (input tax credit) route.
Exporters say while they currently get the refund as quickly as in 15 days, under the ITC route, it would take well beyond six months, in addition to a surge in paperwork for them. Moreover, their working capital, to that extent, will remain blocked for a longer period.
Commenting on the sharp cut in the RoDTEP outlay for FY22, Federation of India Export Organisations (FIEO) president Sharad Kumar Saraf said it is impossible to offset the blow of all the embedded levies within an annual outlay of just Rs 13,000 crore (about $1.8 billion) when exports are typically above $300 billion a year.
Also, since these are mere reimbursements of various taxes that exporters are not supposed to pay in the first place, these are not “benefits” or “incentives” as touted to be. Some exporters said they fear the government would effect a steep cut in the RoDTEP rates to rein in the outgo within the stipulated amount.
Also, they asked the government to firm up the RoDTEP rates for the export of different products at the earliest.
Since exporters typically factor in the “incentives” they get under key schemes while firming up deals, the absence of clarity on RoDTEP rates is hurting their prospects, they said.
While the government has rolled out the scheme from January 1, it is yet to announce the rates.
A committee set up under former commerce secretary GK Pillai in late July last year is yet to finalise the RoDTEP rates for all products, as it’s a humongous exercise.
The RoDTEP scheme is proposed to cover levies that are not subsumed by the GST (petroleum and electricity are still outside the GST ambit, while other imposts like mandi tax, stamp duty, embedded central GST and compensation cess, etc, remain unrebated).
In a media interaction, FIEO director general Ajay Sahai said the Budget has also announced a confiscation of goods under wrongful claim of refund/remission.
This is particularly “harsh, as confiscation of goods will not only hurt the exporters but will also affect the country’s exports as well as its image”.
Moreover, the word “wrongful claim” is subject to various interpretations and will put exporters at the mercy of field formations, bringing back the fear of ‘inspector raj’.
According to a FIEO estimate, after a Covid-induced contraction this fiscal, India’s exports could rise to $340-350 billion in FY22 as the advanced economies are expected to recover from the shock of the pandemic. However, much depends on how the government implements the RoDTEP and remove other irritants, they say. Exports are expected to drop by about 8%, year on year, to $290 billion in FY21.
Source: The Financial Express
The government is confident of achieving a much lower level of fiscal deficit in the next fiscal compared to what has been stated in the Budget owing to improved tax buoyancy, chief economic adviser K V Subramanian said at the CII post-Budget interaction on Wednesday.
“It’s a far-sighted Budget, which has laid the background for ushering in higher growth in the years to come. The government is assured on under-promising and over-delivering on the key challenges facing the country,” Subramanian said during the interaction attended by more than 200 top CEOs from across the country.
He added that the government has laid stress on implementing structural reforms to overcome the current crisis so that the supply potential of the economy can be expanded, which would keep inflation under control when the uptick in demand materialises.
The 137% increase in healthcare spending takes care of both the preventive and curative sides and is indeed an accurate representation, he said.
“The unveiling of the blueprint of a new privatisation policy in the Budget is akin to the landmark reforms carried out in 1991… the policy has also opened a host of opportunities for the private players, who now partake in India’s growth story by buying the brownfield assets of the PSEs at an attractive valuation,” Tuhin Kanta Pandey, secretary of department of investment and public asset management (DIPAM), said at the event.
Source: The Economic Times
The 15th Finance Commission (FC) has endeavoured to arrest a trend of concentration of fiscal powers with the Centre, its chairman NK Singh told FE.
The commission also sought to mitigate an inevitable fall in the shares of some states in the divisible tax pool resulting from its terms of reference (ToR), by rewarding their creditable demographic performance and earmarking adequate revenue deficit grants, he added.
Recent years have seen a shift towards more fiscal resources being at the disposal of the Centre.
Even a liberal tax-devolution award for states by the 14th Finance Commission or guaranteed GST revenue growth for states could not completely hold it back. Increased resort to cesses and surcharges by the Centre to bolster its non-shareable tax receipts and a redesigning of the centrally sponsored schemes fuelled the trend.
While the terms of reference given to the 15th Finance Commission by the President raised the fears of further concentration of fiscal powers at the Centre, the commission seems to have sought a slowing of the pace of erosion of the relative fiscal space with the state governments.
The 15th FC assessed that aggregate transfers to states — untied tax transfers and assorted grants, including those to local governments — would be Rs 52.5 lakh crore or 34% of the Centre’s gross revenue receipts (GRR) during its award period, FY22-26. The divisible tax pool is envisaged to be 76% of the Centre’s gross tax receipts.
On these estimates barely signifying an improvement in states’ share of fiscal resources — total transfers turned out to be 35% of the GRR in 14th Commission’s award period and 33.2% in the terminal year of FY20 — Singh said: “We were quite cognizant of the fact that between 14th and 15th FCs, the incidence of cesses and surcharges has gone up.
Though these imposts clearly defeat the intention of (fiscal) transfers, absent a Constitutional amendment, they do remain outside the divisible pool.
We have, therefore, sought to compensate rising incidence of cesses and surcharge by seeking a much deeper consolidation of the centrally sponsored schemes and central outlays and calibrating the grants component of the transfers, seen at a little over Rs 10 lakh crore in the commission’s five-year award period (FY22-FY26) against tax transfers of Rs 42.2 lakh crore”.
The commission says in its report: “The CSSs co-financed by the government of India should be flexible enough to allow states to adapt and innovate. Top-down mandates and strictures on programme implementation are the antithesis of an open-source model.
CSS should grant states significant latitude to tailor implementation modalities to local realities…the Union Government can shift the focus of CSS and transfers away from line-items and activities and towards outputs and outcomes, with States being empowered to choose their own pathways to achieve results. ”
Essentially, the eligibility for states to access the CSS funds is being sought to be relaxed and they will also get greater discretion on how to use the grants. Of course, the steps might not suffice to fully neutralise the trend (of Centre laying its hands on a higher share of fiscal resources), Singh admitted. He, however added that, “we are not looking at greater centralisation”.
The 15th FC has kept tax devolution rate at roughly the same level at 41% (+ ~1% for the UTs of Jammu & Kashmir and Ladakh) of the divisible pool. However, it seeks the grants component of the transfers to jump 92% from the previous commission’s period, to Rs 10.3 lakh crore, in proof that an effort has been made to buttress the states’ fiscal capacity.
Even as the commission, in keeping with its ToR, proposed a non-lapsable Modernisation Fund for Defence and Internal Security with an indicative size of Rs 2.38 lakh crore for the award period, it again sought to mitigate any adverse impact of the move on resources to be available for states by calibrating the charge on the Consolidated Fund of India.
“We have obtained a legal opinion that funding of defence obligations is the responsibility of every Indian stakeholder and it transcends classifications in the Seventh Schedule (of Constitution).
Though a special financing mechanism via a defence cess or surcharge was suggested, we decided against it.
Monetization of defence lands and disinvestment of defence PSUs are ways to generate resources internally by the defence ministry,” Singh said. Also, the GRR has been adjusted in a manner allowing fiscal space for the Union government to generate funds for defence capex to the tune of Rs 50,000 crore a year.
Singh said the the adverse impact on some states due to the adoption of 2011 population census for horizontal devolution was being sought to be mitigated by creating a new criterion of demographic performance and assigning a weight of 12.5% to it. Also, revenue deficit grants (RDG), seen to be `2.94 lakh crore during the award period, would greatly benefit states like Andhra Pradesh and Kerala, which would have otherwise seen an even bigger decline in their tax pool share.
“If you look at the nature and distribution of RDG, it is also to compensate those states where based on a normative assessment, we estimated a gap in revenue and sought to address it,” Singh said.
He also pointed out that the 15th FC assigned a lower weight of 45% to the crucial need-criterion for horizontal transfers, namely ‘income distance,” compared with 50% weight given by the 14th FC.
Still, the share in divisible tax pool of states such as Bihar (10.05 versus 9.66), Gujarat (3.47/3.08, Madhya Pradesh (7.85/7.54) and Maharashtra (6.31/5.52) are seen to rise substantially in the 15th FC award period, while Karnataka (3.64/4.71) and Kerala (1.92/2.5) are losing out.
Source: The Financial Express
The Indian government is mulling over issuing a clarification on its foreign direct investment (FDI) rule for e-commerce, according to industry and commerce minister Piyush Goyal, who recently said India would resume talks on a trade deal with the United States once a new trade representative assumes charge there and has stepped up talks to forge balanced trade agreements with other large markets like the European Union (EU) and the United Kingdom.
The statement follows reports that the government could tighten the policy that could force companies like Amazon and Flipkart to restructure their existing marketing tie-ups.
Despite differences over offers, both India and the United States negotiated a mini deal for months, before the American election purportedly decelerated the process.
In a virtual meeting with EU trade commissioner Valdis Dombrovskis on February 5, Goyal pitched for a quick ‘early-harvest deal’ followed by a time-bound and balanced free trade agreement (FTA), formal negotiations for which have been stuck over differences since 2013, a news agency reported.
He also spoke to UK international trade secretary Liz Truss last week. Both the sides are weighing the prospect of an enhanced trade partnership, which could lead to a broader FTA, the minister said. The EU, including the UK, was India’s largest export destination (as a bloc) last fiscal, with a 17 per cent share in the country’s overall outbound shipments.
Calling on e-tailers having foreign investments to comply with the ‘spirit of the law’, which bars them from offering discounts directly or indirectly, Goyal said the players are supposed to provide only platforms for buyer-seller transactions and not be a part of such transactions themselves.
In December last year, the commerce and industry ministry asked the Reserve Bank of India (RBI) and the Enforcement Directorate (ED) to take ‘necessary action’ on allegations made by the Confederation of All India Traders (CAIT) against Amazon, Flipkart and Walmart relating to alleged FDI rule violations.
The FDI policy also disallows such online marketplaces from selling products of the companies where they hold stakes or control inventory, and also bars exclusive marketing arrangements, among others.
Goyal said the government is focusing on about two dozen champion sectors through interventions, including production-linked incentives schemes, phased-manufacturing programme, tariff rationalisation and logistics support.
This will result in incremental manufacturing output of ₹20 lakh crore a year, he added. The sectors include pharma, textiles, auto components, aerospace and defence.
Similarly, to ensure consumers have access to quality products and low-grade imports are curbed, the government has developed technical standards for 185 products, imports of which stand at $57 billion a year. Goyal highlighted the government’s resolve to raise the number of products for which technical regulations will be in place.
The minister exuded confidence that the growth in exports in January will continue in the coming months. Signalling a nascent recovery, merchandise exports in January grew 5.4 per cent from a year before, the highest since September 2020 and compared with a 0.1 per cent rise in December
Source: Fibre2Fashion News
The government on Thursday sought Parliament’s approval for gross additional expenditure of Rs 6.28 lakh crore for 2020-21 as part of the second and final batch of supplementary demands for grants.
The proposals involve net cash outgo of Rs 4.13 lakh crore while the remaining amount will be matched by savings of ministries or enhanced receipts.
The approval of Parliament is sought to authorise gross additional expenditure of Rs 6,28,379.99 crore, according to the document placed in Lok Sabha by Finance Minister Nirmala Sitharaman.
“Of this, the proposals involving net cash outgo aggregate to Rs 4,12,653.48 crore and gross additional expenditure, matched by savings of the Ministries/ Departments or by enhanced receipts/ recoveries aggregates to Rs 2,15,725 crore,” it said.
The government has sought Rs 3,04,557.83 crore for the Department of Food and Public Distribution, including for food subsidy, subsidy to sugar mills, and extending soft loans to sugar mills.
Further, Rs 49,112.42 crore has been sought for meeting expenditure under Aatmanirbhar Bharat Abhiyan 3.0 towards payment for indigenous urea (Rs 36,112.80 crore) and import of urea subsidies (Rs 12,999.62 crore).
As per the document, Rs 15,485.88 crore will be for meeting expenditure under Aatmanirbhar Bharat Abhiyaan 3.0 towards payment for indigenous P&K subsidy (Rs 9,722.53 crore), imported P&K subsidy (Rs 5,719.37 crore) and city compost (Rs 43.98 crore).
According to the document, Rs 1,22,208 crore will be for providing loans to state governments through issue of debt under special window under back to back loan to states in lieu of GST compensation shortfall and under special assistance as loan to states for capital expenditure.
An amount of Rs 20,466.50 crore will be for capital outlay on defence services.
Source: The Financial Express
Apparel retail giant VF Corp. will establish a supplier diversity programme to double its spend with minority- and women-owned businesses by 2025 through enterprise direct and indirect procurement, and the activities of its brands.
The company today announced that it is implementing new programmes and actions to advance racial equity within the company and beyond.
By 2024, it will also assess and resolve any identified pay gaps for employees, sponsored athletes and influencers across the organisation through a pay equity analysis.
Building on the company’s Council to Advance Racial Equity (CARE), VF is complementing its previous work by adding a combination of actions and programmes, community partners and public policy initiatives to address opportunity gaps that Black and Brown Americans face in the areas of access to education, economic equity and environmental justice.
VF’s CARE recently established an initial set of commitments for VF to pursue, which directly align with the company’s Inclusion, Diversity, Equity and Action (IDEA) strategy.
It covers 8 main points. The company aspires to achieve 25 per cent Black, Indigenous and People of Color (BIPOC) representation within its Director and above population by 2030.
The company will apply Mansfield Rule requirements, a recruitment benchmark originally developed for the legal industry, to its talent acquisition and development decisions across all company departments.
All the employees of company will participate in a foundational inclusion and diversity learning journey to ensure they share a common vocabulary and commitment to establishing a culture of belonging, allyship and advocacy.
“We’re excited about our new partnership with Management Leadership for Tomorrow and its Black Equity at Work certification programme as we take our support for social justice to the next level.
At the same time, our partnership with PENSOLE directly aligns with our commitment to enable racial equity for marginalised communities with a specific focus on uplifting the Black and Brown communities, which have been traditionally under-represented in the fashion and design space,” said Steve Rendle, Chairman, President and CEO of the company.
Source: Apparel Online
The new Foreign Trade Policy is likely to focus on encouraging exports through ecommerce as also identifying districts as export hubs while re-looking at products that are restricted or banned for export and import.
The commerce and industry ministry is drawing up the FTP 2021-26, which is likely to be released on April 1 and is expected to have separate chapters dealing with measures for ecommerce, districts as export hubs, and trade in items such as toxic chemicals, micro-organisms and nuclear material.
"More HSN (Harmonised System of Nomenclature) codes (tariff codes assigned to a traded good ) could be added for products that fall in the 'others' category," said an official.
Products categorised in 'others' category do not have HS codes but are tagged along with parts and accessories of categorised goods. Adding more codes will help reduce India's trade deficit since lack of proper categorisation make these products immune to restrictions. Besides leading to customs duty evasion, this misclassification also results in import of low-quality products.
The issues were discussed at a meeting that Hardeep Singh Puri, minister of state for commerce and industry, had with industry chambers and export promotion councils on Thursday.
The Remission of Duties and Taxes on Exported Products (RoDTEP) scheme will be a significant feature of the policy as it has been implemented from January 1 but the incentive rates are yet to be announced.
The RoDTEP will reimburse the input taxes and duties paid by exporters, including embedded taxes, such as local levies, coal cess, mandi tax, electricity duties and fuel used for transportation, which are not exempted or refunded under any other existing scheme.
The policy comes at a time when India is expected to clock $285-290 billion exports in FY21, lower than $314.3 billion in FY20.
As per the official, review procedure for the issue of import and export licenses and clearing of pending license redemption cases too could be part of the policy.
Industry body Trade Promotion Council of India has sought trade data mapping with tariff programme in order to monitor and access trade data under various trade agreements and incentive schemes.
Source: The Economic Times
The textiles ministry is formulating a scheme to promote identified man-made fibre apparel and technical textile products to capture substantial share in global trade, Parliament was informed on Thursday.
In a written reply to the Rajya Sabha, Textiles Minister Smriti Zubin Irani said the Indian textile sector is the sixth largest exporter of textiles and apparels in the world.
The share of the country's textiles and apparel exports in mercantile shipments was 11 per cent in 2019-20.
Taking steps to boost exports, she said, the government has recently decided to extend the benefit of the Scheme for Remission of Duties and Taxes on Exported Products (RoDTEP) to all export goods with effect from January 1, 2021.
The Cabinet has approved Production-Linked Incentive (PLI) scheme in the 10 key sectors to enhance India's manufacturing capabilities and exports.
MMF (man-made fibre) segment and technical textiles are included among the 10 key sect ors with approved financial outlay of Rs 10,683 crore over a five-year period.
"Accordingly, this Ministry is formulating a scheme to promote identified MMF apparel and technical textile lines to capture substantial share in global trade including US," she said.
In a separate reply, she said during crop year (2020-21), cotton production stood at 371 lakh bales.
Till February 3, 2020-21, the government procured 90.39 lakh bales worth Rs 26,432 crore at minimum support price (MSP), benefitting 18.67 lakh farmers.
Source: The Economic Times
The fineprint of the Finance Bill has at least six provisions that may negatively affect the working capital of a company. These include no benefit of Input Tax Credit (ITC) without matching invoice, restriction on issuance of Form C and conditions for refund and rebate.
The Finance Bill proposes a new condition for availing ITC, placing restrictions on getting the credit only to the extent of invoices/debit notes reported by suppliers in their GST returns. While there was partial restriction on availing credit since October 2019, insertion of the condition in the Act has given legislative competence requiring mandatory matching of credits.
Currently, tax-payers are allowed to avail unmatched credit (that is, not reported by vendors) up to 5 per cent of matched credits. This limit was 10 per cent till December 2020.
Issuance of ‘Form C’
Another provision in the Bill proposes restricting the facility for issuance of Form C for re-selling or manufacturing/processing of petroleum products and alcoholic liquor for human consumption. This means mining companies procuring diesel for their operations, or manufacturers buying diesel for usage in manufacture of products liable to GST, will no longer be entitled to concessional rate of CST against Form C.
According to tax experts, this is a big change as manufacturers that were buying diesel inter-State to run their factories would not be able to buy petroleum products using Form C at a concessional rate of 2 per cent, but would need to pay higher taxes.
Sale proceeds
Another provision states that refunds in case of non-realisation of sales proceeds on supply of goods must be done along with interest within 30 days of expiry of the time limit prescribed under the FEMA.
Experts feel that because of this amendment, exporters of goods would need to be more vigilant in collection of sale proceeds within the stipulated timeline. In case of any delay in receipt of the sales proceeds, the exporter would be liable to re-pay the refund claimed on inward supplies along with interest.
Vide the proposed amendment, a person would be required to pay an amount equal to 25 per cent as deposit to file an appeal against the order issued in respect of detention/seizure of goods.
Further, an amendment has been made requiring a person to pay a penalty up to 200 per cent of the tax payable/50 per cent of the value of goods for release of detained/seized goods.
Also, the amendment proposes to omit the option allowing the tax-payer to get seized goods released on a provisional basis under a bond and furnishing of security
Experts say keeping in view the behaviour of tax authorities towards procedural lapses in e-way bills and consequent litigation on such issues, the penal provisions can have a negative impact on the working capital of companies.
Harpreet Singh, Partner with KPMG, said: “Some of the indirect tax amendments like availment of input tax credit to buyer only when the vendor furnishes the details and the same are reflected at the portal, restriction on issuance of Form C other than for re-selling or manufacturing/processing of petroleum products and alcoholic liquor for human consumption and non-availability of rebate option for exporters allowing credit of capital goods, may result in working capital blockages, adding pressure on the balance-sheets.”
Source: The Hindu Business Line
The United States on Tuesday called India was one of the most important partners in the Indo-Pacific region and welcomed its emergence as a leading global power and its role as a net security provider in the region.
"India is one of the most important partners in the Indo-Pacific region to us. We welcome India's emergence as a leading global power and its role as a net security provider in the region," said US State Department spokesperson Ned Price during a press briefing.
"We cooperate on a wide range of diplomatic and security issues, including defense, non-proliferation, regional cooperation in the Indo-Pacific, counter-terrorism, peacekeeping, environment, health, education, technology, agriculture, space and oceans and that list is not exhaustive," he added.
Price also welcomed India's tenure at the United Nations Security Council (UNSC) as a non-permanent member, adding that the US remains India's largest trading partner, with total bilateral trade increasing to USD 146 billion in 2019.
The State Department spokesperson also mentioned the conversation between US State Secretary Antony Blinken and External Affairs Minister S Jaishankar.
"Secretary Blinken today spoke with his Indian counterpart Foreign Minister Jaishankar. I think I would start by saying that the US-India comprehensive strategic partnership is both broad as well as multifaceted. We will continue to engage at the highest levels of pour government to deepen cooperation on many fronts and we are confident that the strong and upward trajectory of our partnership will continue," he said.
Speaking on India-China talks on border dispute: "We are closely monitoring the situation. We know the ongoing talks between governments of India and China and we continue to support direct dialogue and a peaceful resolution of those border disputes."
He further commented that the US is concerned by Beijing's pattern of ongoing attempts to intimidate its neighbours.
Source: The Mint
Indian Union Budget 2021-22: Recently, a video had gone viral on the social media where a man collapsed at an international airport, and a medical student performed cardiopulmonary resuscitation (CPR) for 10 minutes to revive him. It has been 10 months since the nationwide lockdown and the government, too, has been performing CPR to revive the economy that collapsed by an unprecedented magnitude.
Policymakers ushered in a mix of Keynesian and Friedman policies in a series of several mini budgets through 2020. The Union Budget FY22 announced on February 1 was one more in this series with an equal emphasis on growth and social objectives.
It is heartening to see the emphasis of budgetary allocation was on areas that have a higher multiplier effect and can help in generating employment and income among low-and-medium skilled workers.
With expenses budgeted to be high in the coming years, there is an ongoing debate about how the government will fund its expenses and mobilise resources for infrastructure; bank recapitalisation; and capital expenditure, which is expected to rise by 34.5% from last year’s budget estimates. At the same time, it has not raised taxes, and revenues are likely to be low because of subdued economic activity.
For the government, bridging the gap between intention and implementation for many of these projects could be a challenge.
The government recognises the widening gap between expenses and revenue that may arise in the coming years.
It also understands that the alternate option of higher borrowings, other than what it has already announced, will have implications on the country’s deficit, debt and yields. This will not only limit its ability to borrow and raise borrowing costs, but will also undermine the efficacy of the accommodative monetary policy impact.
To raise funds, the government is, therefore, relying on sources such as privatisation and monetisation of land assets, which have long gestation periods.
The inflow of funds after the completion of the deal may stretch over a period of time. Besides, the government has had limited success in realising the scale of disinvestments announced over the past few years.
Therefore, raising the targeted funds for such projects from private and foreign sources within the desired time is likely to be difficult than usual.
To the government’s credit, the disinvestment and privatisation plan is much more granular and has specific timelines for completion in this Budget.
Given that the stock market is at an all-time high, a timely execution could help the government realise the full potential of its assets.
The second challenge will be how the government distributes its planned allocation of the budgeted amount for multi-year projects.
Several of these projects with high multipliers are spread over a horizon of more than one year. India needs to spend and create jobs now to support the economic recovery that has just taken off. Therefore, the window for the government to spend and support the nascent recovery is short. If the share of total spending is more skewed in the later years of the timelines specified, then the economy may not get the desired spending boost it needs over the next year.
In other words, the government has to realise the sources of funds immediately and front-end its spending. For that, it has to ensure stability in policies and get the projects off the ground without these getting mired in regulatory and structural bottlenecks. Certainties associated with the completion of the projects will be key.
The government must also work towards exploring alternate immediate sources. It must tap into the rising household savings and broaden its tax base in the coming months. Improving compliance and plugging loopholes that encourage tax evasion could be a few smarter ways.
This Budget announcement is an indication that the government is determined to do all it takes to revive the economy and has ticked all the right boxes.
It is also unlikely that this Budget will be the last one in the series. Therefore, it will be important to understand more specific details and clarity on spending, which, in turn, will determine the strength and pace of sustainable economic recovery.
Source: The Financial Express
The logistics division, under the Commerce Ministry, has started an exercise to formulate a national packaging initiative, which will be part of the proposed logistics policy. The ministry on Wednesday said that a stakeholder consultation was organised to define the scope and the national packaging initiative as part of the national logistics policy that is currently being finalised.
According to Pawan Agarwal, Special Secretary (Logistics), packaging deserves greater attention from improving the overall logistical efficiency perspective.
"Valuable inputs on packaging came from... participants and more such key players would be involved in the formulation of the National Packaging Initiative," it said in a statement.
It added that e-commerce companies such as Amazon and Flipkart were urged to invest in sustainable packaging as they are one of the biggest users of packaging material.
It was also pointed out that dangerous and chemical verticals would also need special attention from the packaging perspective.
Source: The Economic Times
The labour ministry, on Tuesday, clarified that the International Labour Organisation has not commented on India’s lack of compliance while finalising the four labour codes.
“The ILO has not commented about India’s lack of compliance with ILO Convention - 144 on tripartite consultations in implementing the four Labour Codes,” labour minister Santosh Kumar Gangwar said in response to a question in Rajya Sabha.
According to the minister, India being a founding member of the International Labour Organisation (ILO) has deep respect for its principles and objectives and has always upheld the basic tenets of tripartism.
“The government has done extensive consultations inviting all central trade unions, employers’ associations and state governments,” the minister said
The minister further said that all the four labour codes, at draft stage, were placed on the website of the ministry, for stakeholders’ consultations including the general public.
“Further all the Codes were referred to the parliamentary standing committee on labour and the Committee has given its report which was taken into account before getting passed by the Parliament,” he said.
The four Codes include the Code on Wages, 2019, the Industrial Relations Code, 2020, the Occupational Safety, Health and Working Conditions Code, 2020 and the Code on Social Security, 2020. All the four Codes have been passed by the Parliament and notified. However, the Rules for the Codes are yet to be notified following which the Codes will come into force.
Talking about the retrenchment of workers during the pandemic, minister Gangwar said the employment conditions including retrenchment of the workmen are dealt by the appropriate government i.e. central and state governments in their respective jurisdictions.
“The ministry of labour & employment had issued advisory to the states/UTs and the employers’ associations on March 20, 2020 asking them to extend their cooperation by not terminating their employees, particularly casual and contractual workers from job or reduce their wages,” the minister said.
“For those establishments wherein the appropriate government is the central government, the matters pertaining to employment conditions including retrenchment is dealt by the central industrial relations machinery (CIRM) under this ministry,” he added.
Source: The Economic Times
Pakistan-based leading trade body Khyber Pakhtunkhwa Textile Mills Association (KPTMA) has rejected the value-added textile sector’s demand to allow the import of cotton yarn from India.
Salim Saifullah Khan, Chairman of the association, has said that allowing the import from India would be disastrous to Pakistan’s spinning sector.
As reported by news.com, the association issued a statement, saying that allowing import of cotton yarn from India would create a crisis for the spinning industry of Pakistan and lead to mills’ closure.
“The plea of the value-added textile sector that the quality yarn is not available in Pakistan is not correct, as more than 90 per cent of the yarn produced in Pakistan is available for the value-added sector,” Salim said.
He demanded the Government to not allow the import of cotton yarn and save the spinning industry of Pakistan.
On the other hand, experts of Indian textile industry are of the view that this decision of KPTMA is not going to impact India’s yarn export as Pakistan does not have much share in the same.
Source: Apparel Online
Turkish President Recep Tayyip Erdogan recently announced an ambitious plan to make the country the tenth largest economy in the world by engaging in major investments that would boost the gross domestic product (GDP). “…We've turned towards bigger investments in bigger projects,” he said in his video message during the inauguration of a bridge in the Malatya province.
He also said Turkey is realising more than half of all global mega projects by itself and the country is planning to support ventures in space technology and artificial intelligence.
“With the courage we derive from our strong infrastructure, we constantly raise our targets in every field, enhance our capacities, and, especially, expand new production areas,” Erdogan was quoted as saying by Turkish media reports.
The economy reportedly shrank around 10 per cent year on year in the second quarter, when the first wave of COVID-19 hit, but it managed to swing back to growth from July through September. Economists expect it to narrowly avoid a contraction for 2020 as a whole.
Source: Fibre2Fashion News
Malaysia’s economy fell at a faster than expected clip in the fourth quarter, as stricter coronavirus curbs crimped consumption and slowed the pace of recovery.
Gross domestic product contracted 3.4% year-on-year in the October-December period, the central bank said on Thursday, falling for a third straight quarter and faster than the 3.1% decline forecast in a Reuters poll.
Malaysia’s full-year economic performance fell 5.6% in 2020, the worst annual performance since the 7.4% decline in 1998 during the Asian Financial Crisis, according to data from the department of statistics.
“Going into 2021, growth will rebound, supported by a pickup in global demand and normalisation in domestic economic activities,” Bank Negara Malaysia governor Nor Shamsiah Mohd Yunus said during a virtual news conference.
Malaysia’s economic performance will likely continue to be weighed by the pandemic, especially after a recent surge in cases prompted the government to impose a second lockdown until at least Feb. 18, Capital Economics said in a note.
“The risks are to the downside. Our current assumption is that Malaysia will bring the virus largely under control by next quarter, but if that fails, we will have to cut our forecasts further,” said Alex Holmes, Asia economist with Capital Economics.
Capital Economics expects full-year 2021 growth to come in at 7%. Malaysia’s cumulative coronavirus infections shot past 250,000 on Wednesday, including 923 deaths.
“There have been many developments, the resurgence of COVID and also progress with the vaccines… but importantly, we still expect growth in 2021 to recover,” Nor Shamsiah said. She said monetary policy will “remain accommodative in an environment of modest prices,” and that the central bank has sufficient policy space to provide further support if needed.
Last month, the central bank left its overnight policy rate at a record low of 1.75%. It cut its key rate by 125 basis points last year to prop up the coronavirus-hit economy.
The trade-reliant economy had shown tentative signs of a rebound in the third quarter, driven by improving global demand. Full year exports fell 1.4%, though shipments began recovering in the last four months of 2020.
The central bank said it expects inflation to trend higher this year, after 10 straight months of decline largely due to low retail fuel prices.
The headline consumer prices index declined 1.2% in 2020.
Source: The Financial Express
According to OTEXA, USA imported US $ 2.80 billion worth of denim apparels in 2020, falling 24.92 per cent on Y-o-Y basis.
In terms of volumes, the decline was 21.19 per cent as compared to 2019 and US imported 29.89 million dozen of denim apparels in 2020.
Bangladesh concluded 2020 with the top position in tally and shipped US $ 561.29 million worth of denim apparels to USA, noting a slight fall of 3.98 per cent.
It’s worth mentioning here that the fall of Bangladesh was amongst the lowest in all top countries which ship denim merchandise to USA.
Vietnam too showed resilience as it dropped by just 1.08 per cent in 2020 to ship US $ 368.19 million worth of denim garments to its largest export destination and retained 3rd rank in the tally.
The two countries which saw drastic fall were Mexico and China.
Mexico, the 2nd ranked country in denim shipment to USA, clocked US $ 469.12 million in its respective denim apparel shipment to USA, marking a Y-o-Y fall of 41.54 per cent.
On the other hand, China too plunged heavily by 52.29 per cent to hit US $ 331.93 million
from its denim apparel export in the US market.
Source: Apparel Online
Punjab Governor Chaudhry Mohammad Sarwar visited Uzbekistan with a business delegation, including Gohar Ijaz, head of All Pakistan Textile Mills Association (APTMA).
Investors of Uzbekistan’s Namangan province announced an investment in textile and other sectors of Punjab. Full technical assistance will also be provided to Pakistan for increased cotton production.
According to details issued from Governor’s House Lahore, Governor Chaudhry Mohammad Sarwar along with Gohar Ijaz, Head of APTMA, Fawad Mukhtar-Chief Executive of Fatima Group of Industries, Businessman Ahsan Bashir, President of Uzbekistan-Pakistan Trade and Cultural Center Lahore-Rohail Ikram visited Namangan province of Uzbekistan upon the invitation of Governor of Namangan Shavkat Abdurrazakov.
Governor Mohammad Sarwar with his delegation received a warm welcome by High-ranking officials of Uzbekistan and members of the Pakistani community. In honour of the Punjab governor and to express solidarity with Pakistan, Pakistani flag was permanently installed in The Square of Three Fountains in Namangan city adjacent to the office of Namangan Governor.
During the visit, Governor Chaudhry Mohammad Sarwar with delegation visited the Uzbekistan Business Forum and met with delegations of experts working in the fields of textiles, health, agriculture and trade. The matters regarding increased cooperation and trade between the two countries came under discussion.
Accompanied by the delegation, Sarwar also called on Governor of Namangan-Shavkat Abdurrazakov at his Secretariat during which Governor Abdurrazakov appreciated the role of Pakistan in establishing peace and eradicating terrorism from the region.
Upon the invitation of the Punjab governor, he also agreed to pay a visit to Pakistan soon.
Governor Chaudhry Mohammad Sarwar said that acknowledging the growing development and prosperity of Pakistan, the Uzbek investors have announced to invest and facilitate in sectors of textile, business, tourism etc.
Full assistance on increasing cotton production in Punjab has also been assured, for which a delegation of Uzbek agronomists will soon visit Punjab.
Chaudhry Mohammad Sarwar said that we have assured Uzbek investors that they will be provided with all facilities under one window and their security will also be ensured.
The Government of Punjab is also establishing new Special Economic Zones in various cities of Punjab for domestic and foreign investors.
In line with the vision of Prime Minister Imran Khan, we are working with the business community to promote investment in Pakistan. After Uzbekistan, other countries will also be visited with business delegations for enhanced bilateral trade and investment.
Source: The Daily Times
All top 10 apparel shippers to Canada declined in their respective shipment to Canada. The worst fall was experienced by India with a Y-o-Y decline of 30 per cent, while China noted the least effect on its shipment and sunk only by 7.95 per cent.
China’s share not just remained the highest amongst all, but it increased from 2019 as well. The share of China was 37.57 per cent in total Canadian apparel import values in 2020, while it hovered around just 35 per cent in 2019.
Apart from China, only 2 countries noted fall in single-digit and they are Vietnam (down 9.54 per cent) and Turkey (down 8.59 per cent) and remaining all in top 10 fell heavily in double digits.
Y-o-Y % Change in Value-wise Apparel Exports to Canada from Top 10 Countries:
(Comparison between 2019 and 2020) (Values in US $ million)
|
Countries |
2019 |
2020 |
% Change |
|
World |
10,108.94 |
8,674.92 |
(-) 14.19 |
|
China |
3,541.60 |
3,260 |
(-) 7.95 |
|
Bangladesh |
1,296.35 |
1,015.95 |
(-) 21.63 |
|
Vietnam |
1,063.18 |
961.71 |
(-) 9.54 |
|
Cambodia |
1,009.66 |
873.30 |
(-) 13.51 |
|
Italy |
312.87 |
233.53 |
(-) 25.36 |
|
Indonesia |
293.35 |
223.23 |
(-) 23.91 |
|
India |
317.91 |
222.85 |
(-) 30 |
|
USA |
281.90 |
222.50 |
(-) 21.07 |
|
Mexico |
245.42 |
183.75 |
(-) 25.13 |
|
Sri Lanka |
201.45 |
165.07 |
(-) 18.06 |
|
Turkey |
150.56 |
137.63 |
(-) 8.59 |
Source: Apparel Online
Vietnam’s textile and garment exports to Canada in 2019 moved past $1.1 billion for the first time, a rise of 20 per cent compared to 2018, according to International Trade Centre (ITC) data, which indicate the country has surpassed Cambodia to rank third in textile-apparel exports to the Canadian market.
Last year too, textile-garment exports to Canada maintained robust growth.
Among members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Canada can be considered a market with strong potential moving forward, second only to Japan, according to Le Tien Truong, vice chairman of Vietnam Textile and Apparel Association (VITAS).
Canada’s import scale reached up to $14 billion with Vietnamese garments and textiles, accounting for only 8 per cent of the overall market share, according to a Vietnamese newspaper report.
Experts have therefore advised local firms to meet rules of origin detailed within the CPTPP, with yarn and fabric being purchased from CPTPP member countries as a means of increasing exports to the Canadian market in the near future.
Source: Fibre2Fashon News
Commerce Adviser Abdul Razak Dawood on Tuesday assured value-added textile sector stakeholders of raising their problems with Prime Minister Imran Khan and the federal cabinet.
In an online meeting with representatives of textile and value-added sectors, the adviser said the government would consider and resolve some of the issues that were highlighted during the meeting.
The associations representing textile industry urged Mr Dawood to abolish all duties and taxes through a presidential ordinance and allow duty-free import of cotton yarn which is a basic raw material of the value-added textile sector
The online meeting was attended by Chairman of the Council of All Pakistan Textile Associations Zubair Motiwala, Chairman of the Pakistan Apparel Forum Muhammad Jawed Bilwani, Central Chairman of the Pakistan Hosiery and Manufacturers Exporters Association (PHMA) Riaz Ahmed, PHMA Chairman (South Zone) Tariq Munir, Senior Vice Chairman of the PHMA (North Zone) Farukh Iqbal) as well as businessmen Ijaz Khokhar, Haroon Shamsi and Zia Alamdar.
The participants called upon the government to place a ban on export of cotton yarn of 30 single or below count till June 2021 in order to ensure availability of quality yarn to the export sector so that orders can be completed without hassle and unrest.
They said the government should consider allowing import of cotton yarn from India via the Wagah border as quality yarn is not available and prices are soaring.
Likewise, anti-dumping duties on goods imported meant for re-export by export-oriented units and manufacturing bond should also be abolished, they said.
The industry representatives further sought freeze in the special tariffs of 7.5 cents for electricity and $6.5 for gas for at least next three years and provision of uninterrupted electricity and gas for meeting export orders, the industry representatives said.
The value-added textile sector said that Prime Minister Imran Khan’s plans for industrialisation, increasing exports, creating trade surplus, generation of employment opportunities and earning precious foreign exchange can only become possible only when cotton yarn and uninterrupted supply of utilities is ensured on special ¬tariffs.
The associations also expressed severe concern on the recent announcement of the federal government regarding discontinuation of gas to industrial captive power plants (CCPs).
Source: The Dawn News
The European Environmental Bureau (EEB) recently called on the European Commission to ensure that the forthcoming Textile Strategy recognises that the pressure and impact linked to clothing, footwear and household textiles in Europe is the result of a business model based on the sale of ever-more new products made from finite virgin resources.
The virgin resources have a short useful lifespan and are seldom reused or recycled. This is particularly the case when it comes to clothing and fashion products, EEB said on its website responding to the European Union’s (EU) strategy for sustainable textiles roadmap.
Brussels-based EEB is the largest network of environmental citizens’ organisations in Europe with over 160 member organisations in more than 35 countries.
The Textile Strategy should recognise that economic growth in the global textile and clothing industry is maintained through the extraction and exploitation of resources, from raw materials to labour, EEB said.
To protect the life-sustaining earth functions people rely on and to remain within a safe operating space for humanity, the textile industry’s sheer growth in material use must be addressed.
And with the EU being a significant market of major retailers and brands as well as where they are domiciled or based, policymakers have a responsibility to set the textile sector on a path to a fair and sustainable transition, EEB said.
To date, voluntary self-regulation has not been effective in setting corporate accountability. The Textile Strategy is an opportunity to set an overarching framework that ties together the various new and existing legal instruments affecting a textile product, from production to end-of-life, it said.
These instruments should be based on the principles of absolute resource-use reduction, achieving a toxic-free environment, absolute reduction in climate and environmental impact, and the respect of fundamental human rights, it said.
There can also be no market access for textile products where both human rights and environmental due diligence has not been carried out, and the transition to a more resource-sufficient and toxic-free industry must be a just one for its millions of workers, it added.
EEB will build further on these ideas further as it plays an active role in the continued stakeholder engagement around the Textile Strategy initiative, starting with the forthcoming public consultation.
Source: Fibre2Fashion News
Bringing clarity on genetically modified (GMO) testing methods for the organic cotton sector, organic textile sector reaches a significant milestone in testing for GMO cotton.
The global ISO IWA 32:2019 proficiency test initiative is a collaboration between GOTS, OCA and Textile Exchange with technical support from Wageningen Food Safety Research.
Almost two years ago Global Organic Textile Standard (GOTS), the Organic Cotton Accelerator (OCA) and Textile Exchange partnered to develop the ISO IWA 32:2019 protocol to create a common language amongst laboratories worldwide to screen for the potential presence of GM cotton along the organic cotton value chain.
Following that project, the partners set out on a new initiative to bring much-needed clarity regarding the laboratories that perform testing against the international ISO reference protocol and carry out qualitative GMO testing in cottonseed, leaf, fibre and chemically unprocessed fibre-derived materials.
The joint project has 14 laboratories from China, Germany, India, the Netherlands and Portugal that have successfully passed the proficiency test.
An overview of the laboratories that can currently conduct GMO testing as per the ISO IWA 32:2019 method has now been jointly published by GOTS, OCA and Textile Exchange, which constitutes an important milestone on the journey towards the widespread use of this standardised protocol.
The GMOs are excluded from organic systems, organic isn’t a claim of absolute freedom from contamination or GMOs’ presence in organic products.
It is a claim that GMOs are not deliberately or knowingly used and that organic producers take far-reaching steps to avoid GMO contamination along the organic cotton value chain, from farmers to spinners to brands. To manage this, it is essential that organic cotton stakeholders can reliably test their products for the potential presence of GM cotton.
The ISO IWA 32:2019 is a globally accepted reference protocol that was developed to screen for the potential presence of GM cotton.
Commenting on the initiative, OCA’s Programme Officer, Mathilde Tournebize said, “As a global platform, we are committed to increasing the clarity and reliability of GMO screening for the organic cotton sector.
The first results of the global proficiency test initiative have given us an overview of the laboratories that can be contacted to conduct such tests. We’re hopeful that as we see more laboratories implementing the ISO IWA 32:2019 worldwide, several rounds of proficiency tests will help us all chart the labs that can be contacted to reliably conduct GMO tests.”
Source: Apparel Online
As the demand for products such as fitness trackers and wearable technology increases, so does the need for smart textile and smart apparel. According to a recent market report, the global elegant textile market size is expected to reach USD 5.55 billion by 2025.
The rise of new technologies such as Artificial Intelligence (AI) and the Internet of Things (IoT) has transformed the once labor-intensive textile industry. Computerized machinery is now found in most textile factories, and these machines are far more efficient at creating specific designs on a massive volume than human workers.
New smart apparel products are being created every day. By implementing AI along with technologies such as Bluetooth Low Energy (BLE), edge computing, and cloud data, smart textiles can monitor and communicate the wearer’s information, including biometric data such as blood pressure, heart rate, perspiration, temperature, and more.
This article will examine how AI is impacting the textile industry, some new use cases, and why ultra-low-power (ULP) technologies are a must to fully unleash AI at the endpoints.
AI in the Textile Industry
For textile manufacturers, AI is reshaping their entire production process and the way they conduct business. AI can access and collect historical and real-time operational data, providing insights that can improve operational efficiency. When you have a clear view of your operations, it is easier to tweak processes to magnify human workers’ capabilities.
Whether it is product cost, textile production, quality control, just-in-time manufacturing, data collection, or computer integrated manufacturing, AI leaves an imprint on every part of the process. Some commonly integrated AI applications for textile production include defect detection, pattern inspection, and color matching.
The use of AI has enabled smart apparel, or “smart clothes” that leverage IoT and electronic sensors to create a better user experience. By leveraging these technologies, smart clothes can offer a more comfortable experience and a more healthcare-focused experience. Below, we will examine some of these new possibilities in the textile industry.
Enabling New Use Cases
Much like how fitness trackers can help their users live a healthier and more attentive lifestyle, smart apparel combined with electronic sensing technology can do the same. However, since your clothes have a larger area of contact with your body than something like a smartwatch, smart apparel can potentially provide more types of physiological signal measurements.
Smart clothing can enable continuous monitoring of important biometrics, such as our heart rate. With long-term monitoring more feasible, physicians can better identify or diagnose potential cardiac diseases. Smart clothing helps patients collect complete and comprehensive heart-related data, track long-term heart disease, and enhance the detection and diagnosis of heart issues through regular monitoring over an extended period.
Following the COVID-19 outbreak, consumers have emphasized healthcare and medical attention in their wearable products, which is now extending to smart apparel. Clothes embedded with BLE technology can feel, sense, and regulate data, and the development of fabric-based sensors should only improve the overall wearing experience.
Artificial Intelligence isn’t the only technology driving forward the textile industry. Cloud data, edge compute, accurate sensors, and ultra-low-power technologies are also necessary components. Especially for smart clothes that rely on BLE and IoT technologies, a long-lasting energy source from their embedded battery must provide a satisfactory and useful consumer experience.
Source: IoT For all News
On a total basis, retail sales in UK decreased by 1.3 per cent in the four weeks from January 3 to January 31, 2021, against a decline of 0.4 per cent in January 2020 (when there was an extra week), according to the BRC-KPMG Retail Sales Monitor. This is below the 3-month average growth of 0.6 per cent and above the 12-month average decline of 0.4 per cent.
However, on a like-for-like basis, UK retail sales increased 7.1 per cent from January 2020, when they had decreased 0.8 per cent from the preceding year, the January sales monitor said.
Over the three months to January, in-store sales of non-food items declined 36.5 per cent on a total and 19.8 per cent on a like-for-like basis. This is worse than the 12-month total average decline of 28.3 per cent. For January, the like-for-like excluding temporarily closed stores remained in decline.
Over the three-months to January, non-food retail sales increased by 5.6 per cent on a like-for-like basis and declined 5.6 per cent on a total basis. This is above the 12-month total average decline of 5.8 per cent. For the month of January, non-food was in decline year-on-year.
Online non-food sales increased by 83.0 per cent in January, against a growth of 1.0 per cent in January 2020. This is the highest on record and above the 3-month average of 57.3 per cent and the 12-mth average of 43.1 per cent.
Non-food online penetration rate increased from 31.2 per cent in January 2020 to 63.6 per cent in January 2021.
“January saw retail sales growth decline to its lowest level since May of last year.
The current lockdown has hit non-essential retailers harder than in November, with the new variant hampering consumer confidence and leading customers to hold back on spending – especially on clothing and footwear. Meanwhile, retailers have worked incredibly hard to expand their online delivery and click and collect offerings to ensure everyone can get the products they need during lockdown.
This has led to record growth for online non-food sales and is a testament to the resilience and innovation of retail, which in the face of the pandemic, has rapidly adapted and invested in online platforms and delivery logistics," said British Retail Consortium (BRC) chief executive Helen Dickinson.
“Retail firms are supporting the government’s efforts to combat the virus and the industry will continue to play its part in the fight by stepping up safety measures to keep their teams and customers safe.
However, three periods of prolonged closure for some and the ongoing uncertainty around reopening puts many retailers in a precarious position.
If the government wants to avoid further administrations of otherwise viable businesses and thousands of jobs losses, it must provide those firms which have been hardest hit with the necessary financial support, including targeted business rates relief beyond March,” Dickinson added.
“For the first time since last spring, we saw total monthly sales decline and even the on-going demand for groceries and home-related categories was not enough to halt the fall. Although online channels continued to experience historic growth with more than 60 per cent of all non-food sales transacted online, the lockdown meant that the traditional January sales period did not really materialise for the rest of the retail sector, with just a handful of categories recording any growth," said KPMG's UK head of retail Paul Martin.
“Clothing retailers continued to struggle with physical sales down across all categories," Martin added.
With much of the UK in lockdown for the foreseeable weeks, conditions for retailers will continue to be incredibly challenging, according to Martin.
"On the one side dealing with a continued increase in online demand versus subdued demand on the high street – and overall in many cases, thinner margins and rising logistics costs and complexities post Brexit. Consumers are well versed in lockdown living now, and looking ahead, fortunes will be mixed but pent up savings and a successful vaccine roll out should help to support recovery in the retail sector later in the year.”
Source: Fibre2Fashion News
Brooks Running ended 2020 with global revenues of nearly $850 million, an increase of 27 per cent year on year (YoY). Its investment in its consumer research Run-Sight Lab and singular focus on runners was a major advantage and contributed to the success. Despite the devastating impact of the pandemic on businesses, Brooks’ market share grew around the globe.
US company Brooks Running sells its performance footwear, apparel, run bras and accessories in more than 50 countries.
“In 2020, the Brooks team stayed very close to the runner for cues on how to navigate the uncertainty caused by global retail and supply chain disruptions,” said chief executive officer Jim Weber in a press release.
The brand quickly adjusted its communication approach and reinforced its omni-channel distribution support to engage with runners and make sure they could find Brooks whenever and wherever they chose to research and shop.
The brand’s sales and operations team created a process that included a new demand model to replace retailer signals with cues coming from digital sell-through and running participation.
By the middle of the year, this customer-focused process gave the brand the confidence that demand for Brooks was exceeding previous year sales, prompting a green light to reignite production to meet demand.
At retail, Brooks was the No. 4 adult performance running footwear brand in the United States last year with 8.5 per cent dollar share, up 1.8 points year over year. In the same period, the Brooks Ghost became the No. 1 franchise for adult performance running in the total and run specialty markets combined.
Brooks gained more than 3 points of performance running dollar-share among runners in 2020 compared to 2019 and for the first time ever became the No. 2 brand among runners based on dollar-share position.
In 2020, during brick-and-mortar retail closures, Brooks sales online shifted north of 75 per cent, stabilizing at 46 per cent by year end. With the runner in control of their shopping journey, Brooks’ multi-channel presence mattered as they moved from physical stores to online shopping.
Source: Fibre2Fashion News
The Philippines is a favored destination for Italian businesses that are looking to expand their operations to Southeast Asia, the Board of Investments (BoI) said on Friday.
In a statement, the investment promotion agency said Enrico Letta, president of the Associazione Italia-Asean, announced this during an online webinar organized by his group and the Italian Chamber of Commerce in the Philippines on January 26.
Asean stands for the Association of Southeast Asian Nations, of which the Philippines is a founding member.
“Letta said Italy intends to expand its businesses in the Asean region, with the Philippines as its top priority, as the said seminar aims to strengthen relations and bridge opportunities between Italy and the Philippines,” said the BoI, an attached agency of the Department of Trade and Industry.
Lanie Dormiendo, BoI officer in charge-director, said the Philippines appreciated the southern European nation’s “vote of confidence” as it “continues to improve its business climate through strategic policy reforms to make it easier for investors to do business and further encourage the flow of foreign direct investments into the Philippines.”
“With our Rebuild Strategy and 3Ps (Policies, Projects & Programs, Promotion) of industry development supported by the country’s strengths, there is a wide scope of business opportunities for Italian investors, complementing Italy’s expertise to support Philippine infrastructure projects and other industries, such as garments,” Dormiendo was quoted as saying in the statement.
She added that the government’s “Make It Happen in the Philippines” branding campaign, which was launched in November, also stressed “the strength and adaptability of the Philippines to weather through challenges, exuding strength and adaptability, even in times of difficulties.”
Sectoral opportunities for Italian investors, focusing on garments and textiles, specifically for natural fibers wherein the country is strong, like abaca and pineapple, were also discussed by Dormiendo, according to the BoI.
It also said Philippine Ambassador to Italy Domingo Nolasco pitched several reasons Italian companies should invest more in the Philippines. He highlighted that several sectors, such as infrastructure, aerospace, renewable energy and machineries, also offered investment opportunities.
“Italy is considered as an important contributor of foreign investments from the European Union (EU) to the Philippines,” the agency said, adding that approved Italian investments reached P114.7 million in 2020.
Meanwhile, Italian investments made since 2015 totaled P1.32 billion as of last year.
Citing preliminary numbers from the Philippine Statistics Authority, the BoI said Manila imported $584.3 million worth of goods from Italy and exported about $200 million in goods in 2020.
Source: The Manila Times
Cordura brand and Artistic Milliners have collaborated in the evolution of a new choice of workpants from US women’s workwear specialist, Dovetail. This marks the debut of the Noir No Fade Black Cordura denim, part of the Artistic Milliners Supercharged Cordura Denim collection. Cordura fabric used in many leading high-performance gear and apparel products.
With the development of Noir denim from Artistic Milliners, the denim company of the future; Cordura brand were able to help Dovetail deliver a tough, sustainable workpants, just like the women who wear them. Dovetail is a company set up and run by women, dedicated to designing and producing workwear for women, according to Invista, the parent company of Cordura.
“We build radical pieces out of need. Women tell us what they want and we go from there.
Our latest Maven and Britt style pants with ‘No Fade Black’ Cordura Denim came from a request from our most hard-core customers, who asked for the toughest possible pant.
We were getting requests for a non-fading black pant, from women who work in tough roles as roadies, theatre techs, and film crew. These pants are up to four times stronger than regular cotton denim and have a comfy stretch.
There’s also a built-in long lasting softness that comes from the supple wood-based Lenzing Tencel branded modal fibres used. These fibres come from a blend of sustainable wood sources and that’s important, because sustainability is a key factor now for our customers,” Sara DeLuca, co-founder of Dovetail said in an Invista press release.
“Artistic Milliners is a world player in the denim sector, and we were delighted to work with Dovetail and the Cordura team.
Both these brands share our own innovative attitude to coming up with relevant solutions for today’s market. As a recognised UN pioneer in sustainability, our team was excited to harness our expertise to tackle Dovetail’s challenge.
And we were able to deliver with the debut of the Noir (No Fade Black) denim that’s part of our Supercharged Cordura denim collection.
This is an exciting portfolio of durable, long-lasting, high- performance tech denims for today’s stylish and comfort-driven consumers,” Ebru Ozaydin, senior vice president of sales and marketing at Artistic Milliners said.
“At Cordura our belief is that sustainability begins with products that last. Quite simply, the longer something lasts the less need to throw it away and consume yet more resources. What an incredible experience it was for me personally to be working with such a talented team, and in particular, to help develop a solution that was specifically addressing women’s workwear needs,” Cindy McNaull, business development director at Cordura said.
Source: Fibre2Fashion News
US cotton producers plan to plant 11.5 million cotton acres in 2021, down 5.2 per cent from 2020, according to (NCC) National Cotton Council’s 40th annual early season planting intentions survey. NCC’s mission is to ensure the ability of all US cotton industry segments to compete profitably in the raw cotton, oilseed, and US-manufactured product markets.
Upland cotton intentions are 11.3 million acres, down 4.9 per cent from 2020, while extra-long staple (ELS) intentions of 161,000 acres represent a 20.7 per cent decline, according to a media statement by NCC.
State-level details, along with the full economic outlook is being released as part of the NCC’s US Cotton Economic Outlook presentation during the NCC Annual Meeting’s general session.
Source: Fibre2Fashion News
The way UK Cabinet Office minister Michael Gove has been handling exports to the European Union (EU) since the Brexit transition period ended has attracted a new wave of criticism. The volume of exports made through British ports to the EU reportedly fell by 68 per cent in January compared to the same month last year, and that drop has been largely attributed to problems caused by Brexit.
The Road Haulage Association (RHA) flagged the issue to Gove after surveying its international members.
In a letter to Gove dated February 1, RHA chief executive Richard Burnett pointed out that despite repeated warnings over several months of problems and calling for measures to lessen difficulties, the minister largely ignored them.
One example of the new difficulties facing exports that Burnett highlighted is the need to raise the number of customs agents to help firms with mountains of extra paperwork. There are 10,000 customs agents now, but this is still about a fifth of what the RHA says is required to handle the massive increase in paperwork facing exporters.
Burnett said that in addition to the 68 per cent fall-off in exports, about 65-75 per cent of vehicles that had come over from the EU were going back empty because there were no goods for them to return with, due to hold-ups on the UK side, and because some UK companies had either temporarily or permanently halted exports to the EU.
The RHA also warned in January that a 12-month grace period and urgent financial aid were needed to fix problems with the post-Brexit trade border in the Irish Sea. The UK government has instead allowed for just a six month grace period, meaning the full range of physical checks on imports will begin in July.
“We will have an economy looking to come out of lockdown at the same time as the UK is imposing a range of import controls on EU business that may be no more prepared than UK businesses have been—and possibly less so—and a supply chain that is incredibly reluctant to service the UK.
The full Brexit crisis that we were predicting could well come into effect at that point,” Shane Brennan, chief executive of the Cold Chain Federation, told a top UK daily.
Last month it emerged that a number of online retailers from the European Union are refusing to deliver goods to the UK because of new Brexit taxes that came into force.
Source: Fibre2Fashion News
Page Industries Limited, which is India’s leading apparel manufacturer, is out with its financial results for the third quarter and 9 months that ended 31 December 2020.
Q3 saw the company post a quarter-over-quarter (Q-o-Q) revenue increase of 25 per cent and 17 per cent year-over-year (Y-o-Y) jump to Rs. 9,271 million.
The report distinctly showed that its cost optimisation efforts were maintained, while the operating costs were reduced by 5 per cent to Rs. 1,417 million. Notably, it was achieved without any layoffs or salary cuts.
The EBITDA margin too saw a rise from 17 per cent to 24 per cent during the quarter. The profit after tax (PAT) jumped by 39 per cent Q-o-Q and 77 per cent Y-o-Y at 1,537 million. Importantly, the company has repaid all outstanding borrowings and is debt-free.
The cash and cash equivalent saw a Q-o-Q rise of 23 per cent to 4,941 million.
For the 9-month period, the Y-o-Y revenue fell to 19,522 million. However, the company is happy to witness steady recovery with a pick-up in sales momentum. The operating cost too fell by 31 per cent to Rs. 3,058 million.
Pleased over all-time high revenue, Sunder Genomal, MD, Page Industries, said “We continue to strengthen management with the best talent and invest in digital transformation, technology and innovation in product design and development, marketing and brand building.”
He added “There is also renewed focus in becoming more efficient and optimal in all aspects of the business, while at the same time taking care to eliminate any wasteful spend or activity.”
Page Industries Limited is the exclusive licensee of JOCKEY International Inc. (USA) for manufacturing, distribution and marketing of the JOCKEY® brand in India, Sri Lanka, Bangladesh, Nepal, Oman, Qatar, Maldives, Bhutan and UAE.
Source: Apparel Online
